The Dilemma of Energy Security: Political and Institutional Hazards in Case of Pakistan (1999-2013)
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THE DILEMMA OF ENERGY SECURITY: POLITICAL AND INSTITUTIONAL HAZARDS IN CASE OF PAKISTAN (1999-2013) THIS THESIS IS SUBMITTED TO THE UNIVERSITY OF THE PUNJAB IN FULFILLMENT OF THE REQUIREMENT FOR THE DEGREE OF DOCTOR OF PHILOSOPHY ASIA MUKHTAR PhD Session: 2013-17 Roll No. 01 Supervisor: Prof. Dr. Iram Khalid DEPARTMENT OF POLITICAL SCIENCE UNIVERSITY OF THE PUNJAB, LAHORE PAKISTAN 2016 DECLARATION I, Asia Mukhtar d/o Mukhtar Ahmad, Registration No. 94-cw-517, student of PhD at the Department of Political Science, University of the Punjab, Lahore solemnly declare that the thesis entitled “The Dilemma of Energy Security: Political and Institutional Hazards in Case of Pakistan (1999-2013)” submitted by me in partial fulfillment for the award of PhD degree, is my original work, except as otherwise acknowledged in the text, and has not been submitted or published previously and shall not be submitted in the future for obtaining any degree from this or any other university/ institution of Pakistan or any other country. Dated: _____________ Signatures:_______________ Name: Asia Mukhtar CERTIFICATE This is certified that the present thesis entitled “The Dilemma of Energy Security: Political and Institutional Hazards in Case of Pakistan (1999-2013)” is written by Ms. Asia Mukhtar for the requirement of Ph.D. Degree in International Relations. To the best of my knowledge the thesis is based on original research. PROF. DR. IRAM KHALID DEPARTMENT OF POLITICAL SCIENCE UNIVERSITY OF THE PUNJAB LAHORE DEDICATED TO MY PARENTS ASPIRATION OF MY LATE FATHER AND PRAYERS OF MY MOTHER ENCOURAGED ME TO ACCOMPLISH THIS HUGE TASK Table of Contents Acknowledgements i List of Abbreviations iii List of Tables vii List of Maps and Illustrations ix Chapter Topic Page No. No. I Contextual Framework Introduction 03 1.1 Literature Review 07 1.2 Objectives 35 1.3 Research Questions 35 1.4 Hypothesis 36 1.5 Research Design 36 1.6 Plan of Work 38 II Theoretical Perspective of Energy Security Introduction 47 2.1 What is Energy Security 47 2.2 Link between Security Theory and Energy Security Theory 50 2.3 Concept Development 52 Main Theories of International Relations Pertaining to Energy Security 54 2.4 Realism 55 2.4.1 Realism and Energy Security Theory 56 2.4.2 Realists’ Main Assumptions on Energy Security 57 2.5 Neorealism 58 2.5.1 Neorealism and Energy Security 58 2.6 Copenhagen School approach 59 2.7 Liberalism 60 2.7.1 Locke’s International System 61 2.7.2 Commercial Liberals 62 2.7.3 Liberalism and Energy Security 63 2.8 Neoliberalism and Energy Security 64 2.9 Institutionalism and Energy Security 65 2.10 Summary of Theory Progress 68 2.11 Limitations/ Weakness of Theory 70 Energy Insecurity and International Relations 72 Energy Security Dilemma in South Asia 73 Energy Context in South Asia 75 2.12 Increase in Demand 76 2.13 Increase in Price 77 2.14 Increasing Foreign Dependency 78 2.15 Energy Security Dilemma in Pakistan 79 2.15.1 Current Energy Crisis: Challenges and Implications 82 2.15.2 Major Issues of Energy Sector 83 III History of Developments in the Energy Sector of Pakistan. First Phase of Energy Development 1947-77 98 Major Energy Developments in Main Energy Sectors 99 3.1 Hydro power 99 3.1.1 1947 till Indus Water Treaty 99 3.1.2 Indus Water Treaty till 1971 104 3.2 Thermal Power 1947-77. 105 Major Policies in the Energy Sector 1947- 77 108 3.1 Initial organizational set up of the energy resources- 1947- 55 110 3.1.1 Planning Sector 112 3.1.2 Establishment of Central Engineering Authority (CEA) 1948 112 3.1.3 The Six Year Development Program 1951-57 (Colombo Plan) 112 3.1.3.1 Nationalization of Private Electric Companies 113 3.1.3.2 Hydrologic Division of Regions 113 3.1.3.3 Installation of Captive Generating Capacity 113 3.3.2 Fuel Sector 114 3.3.3 Atomic Energy Sector 115 Organizational set up of the Energy Resources- 1955-77 116 3.4 First Five Year Plan- 1955-60 116 3.5 Second Five Year Plan 1960-65 118 3.6 Third Five Year Plan 1965- 70 122 3.7 Fourth five year plan 1970-78 125 An Analysis of Energy Sector in Five Years Plan 134 3.8 Political Elusive 134 3.9 Executional Hazards 136 Second Phase of Energy Development 1977-99 138 3.10 Major Energy Developments in Main Energy Sectors 138 3.10.1 Hydro Power 138 3.10.1.1 Kalabagh Dam Construction and Controversy 139 3.10.2 Thermal Power 142 3.10.2.1 Thermal Power of WAPDA 143 3.10.2.2 Thermal Power Plant Established under WAPDA 144 3.10.2.3 IPPs: A Turning Point in Energy Sector 145 3.10.2.4 Nuclear and Renewable Energy- Vague Contoures 148 Major Policies in the Energy Sector 1977-99 149 3.11 Fifth Five Year Plan 1978-83 149 3.12 Sixth Five Year Plan 1983-88 152 3.13 Major Power Policies from 1993- 1999 155 3.14 Power Policy of 1994 157 3.15 1995 Hydel Policy 159 3.16 Executional Hazards and Institutional Incapacitation 162 IV Prevailing Challenges and Practices in the Development of Energy Sector in Pakistan 1999-2013 Introduction: 174 4.1 Inherent Factors and Challenges 175 4.1.1 Water Insecurity (Background) 178 4.1.2 Viewpoint of India on IWT 179 4.1.3 IWT Benefits to India 182 4.1.4 Viewpoint of Pakistan on IWT 182 4.1.5 IWT Benefits to Pakistan: 188 4.1.6 Point of View of World Bank on IWT 189 4.2 Thermal Reliability 191 4.2.1 History of Thermal Power Generation in Pakistan 194 4.2.2 Oil & Gas Exploration 195 4.2.3 Major Managerial Issues in OGDC: 198 4.2.4 Coal Exploration 200 4.2.5 Technical and Institutional Hazards regarding Exploration Thar Coal Region 204 4.2.6 Key Implementation Challenges in Coal Power Generation 206 4.3 Failure in Nuclear Power Energy Generation 208 4.3.1 Major Issues in the establishment of Nuclear Power Plants in Pakistan 209 4.3.2 Nuclear Power Plant Planning and Execution 210 4.3.3 Waste Management 212 4.3.4 Nuclear Safety and Proliferation Issue 212 4.4 Negligence of Renewable Energy Resources 212 4.4.1 Negligence of Renewable Energy Resources 215 4.4.2 Wind/ Tidal Energy 218 4.4.3 Bio Mass 219 4.5 Lack of Long Term and Coherent Energy Planning 220 4.5.1 Management of Energy Sector 221 4.5.2 Power Management Policies From 1994 till 2013 221 4.6 Institutional Incapacitation 226 4.7 Political Hazard 227 V Energy: A Comparative Analysis of South Asia Region Introduction: 243 5.1 South Asian Region 244 5.2 Energy Security Scenario in South Asian Region 246 5.2.1 Afghanistan. 246 5.2.2 India 249 5.2.3 Maldives 253 5.2.4 Bhutan 253 5.2.5 Nepal 257 5.2.6 Sri Lanka 260 5.2.7 Bangladesh 262 5.2.8 Pakistan 266 Regional Energy Security Set- up: Major Challenges and Cooperation 269 Scenario 5.3 Major Challenges 271 5.3.1 Access to Energy 272 5.3.2 Energy Cost (Subsidies and taxation mechanism) 275 5.3.3 Efficiency between supply and demand 277 5.3.4 Renewable Energy- Issues and Prospects 280 5.3.5 Inter State Energy Trade 284 5.3.6 Inter- Regional Energy Trade 289 Trans- Boundary River Basins Disputes in South Asia 292 5.4 The Indus Basin Controversy 293 5.5 Great Ganga Basin Controversy 295 Regional Energy Prospects and Possibilities for Pakistan 298 Steps for Positive Trade Prospects in South Asian Region 302 VI Conclusion 6.1 Reviews and Reflections 320 6.2 Findings 334 6.3 Suggestions 351 Bibliography 367 Appendixes 405 i Acknowledgements Thesis writing is an arduous task which requires whole hearted and dedicated contributions. Moreover if the topic is challenging, toil and efforts are redoubled. I owe a great deal to Allah’s mercy and blessings in the completion of this task. The topic of Energy Security has recently loomed into the focus of academia. On the account of this novelty, finding analytical and academic work on the topic was very difficult task. Some genuine analyses are made through discussions with the energy sector experts and officials. Some original reports were accessed and yearbooks were explored. These challenges have made me owe a great deal of gratitude. It was my great privilege to work under the supervision of Prof. Dr. Iram Khalid. In edition to being a tremendous mentor, she allowed me to grow in the field of research and knowledge through constant attention, incessant advice and relevant suggestions. The very concept of this research topic owes her profound thoughts. I am whole-heartedly grateful to her. I extend my extreme gratitude to the Head of Political Science Department, Prof Dr. Umbreen Javed, for providing all possible facilities. It was rather impossible to complete this PhD without owing a kind favor to the administration of Lahore Grammar School and University of Gujrat, who adjusted my busiest research schedule with the professional obligations. The challenge of working on the topic like energy security demanded extended quantitative research activities. In this connection all professionals and general public deserve my thanks that generously provided their views and comments on all sectors of the energy department of Pakistan. My special thanks to Mr. Suleman Najib Niazi, Fellow IEEEP (Former Chairman LLC), Mr.