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ADB mounts pressure on govt to corporatise DESA
AZM Anas

          The Asian Development Bank (ADB) continues to mount pressure on the government to accelerate the process of corporatising the Dhaka Electric Supply Authority (DESA) as part of a broader reform in the power sector.
The Power Division faces the renewed pressure from the Manila-based development lender as its Executive Director Emile Gauvreau flies to Dhaka on a five-day tour on September 30.
The ADB high official is scheduled to meet the top officials of the Power Division, including its Secretary, to take stock of the progress of the ADB-assisted power projects and reform of the sector, sources at the Power Division said.
The donor agency has repeatedly expressed its concern over the foot-dragging of the government to register the association of newly structured DESA with the Joint Stock Company.
A high official of the Power Division, however, acknowledged that although the articles of the association have already been finalised with vetting from the Law Ministry, the registration process is being delayed due to strong resistance from the collective bargaining agents (CBAs).
The corporatisation plan of the DESA has evoked sharp reaction from its employees with its trade unions baulking at, what they alleged, the donor-dictated reform package.
Under the plan, all generation, transmission and distribution units of the power sector would be made region-based holding companies.
Officials of the Power Division have remained sceptic about the possible outcome of the corporatisation of the DESA.
The officials favour the reform in the DESA considering the necessity to reduce its losses and eliminate graft, but they are opposed to any "knee-jerk rush" in turning it into a company.
The decision reflects the government's broader outlook to corporatise and commercialise the power sector as a whole, they added.
"Corporatisation may be an option for the DESA to help whittle down its ballooning losses and bridle corruption. But will the process of handing over the company be carried out in a proper way?," an official questioned, citing a previous experience.
Referring to the bitter experience of the DESCO (Dhaka Electric Supply Company), a brainchild of the multilateral donors, the official said it would be yet another failure on the part of donors.
He questioned whether the new company could improve its services, and lessen the harassment of consumers while keeping the previous staff of the DESA in service.
At least, four missions of the ADB visited the country in the last two months to push for expediting the corporatisation process.
Official figures available with the DESA have put its losses at Tk 1.0 billion in the first six months of the last fiscal, suggesting that the power supply agency counts nearly Tk 200 million in losses every month.
DESA's revenue earnings have been plummeting over the years, notwithstanding the government's drive to streamline the agency by reining in a section of the CBA leaders and errant employees.
Sources said about 50 per cent of the electricity of DESA, purchased from the Power Development Board (PDB), were being pilfered by dishonest employees and officers in the name of systems loss.
The cumulative systems loss of the DESA stands at about 23.6 per cent while that in some divisions, including Postagola and Lalbagh, it is more than 40 per cent. The most corrupt DESA circles are Lalbagh, Postogola, Narayanganj and Tongi whose incomes continue to decline, it is learnt.
The corporatisation of the PDB and the DESA was among a number of conditions the ADB tagged with providing loans amounting to US$100 million under the Power Sector Development Programme.
The ADB appointed consultants from the British Power International for working out a roadmap for the Power Division to help turn the DESA into a holding company.


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