🔳 When Pakistan’s Supreme Court Declared the Rental Power Projects (RPPs) Agreements Illegal and Ordered Their Cancellation 🔲 Public Research Series | Episode 54 Topic: How Can Pakistan’s Electricity System Be Reformed? Title: Rental Power Agreements, the Supreme Court Ruling and the Heavy International Arbitration Award 🔺 Following the Supreme Court’s decision, Turkish company Karkey Karadeniz initiated international arbitration proceedings against Pakistan, seeking approximately US$2 billion in damages. The arbitration ultimately resulted in an award against Pakistan of approximately US$490 million. It is important to note that the Turkish company supplied electricity through a power-generating vessel stationed off the coast of Karachi. Written & Researched by: Syed ShayanMarch 30, 2012 became a significant date in Pakistan’s judicial history when a two-member bench of the Supreme Court, comprising Chief Justice Iftikhar Muhammad Chaudhry and Justice Khilji Arif Hussain, declared the agreements relating to the Rental Power Projects (RPPs) void, illegal and contrary to the Constitution, and ordered their immediate cancellation. In its judgment, the Court observed that serious questions of transparency surrounded the Rental Power agreements and that billions of rupees had been paid in advance, including mobilization advances, resulting in losses to the national exchequer. The Supreme Court directed the National Accountability Bureau (NAB) to immediately initiate criminal investigations against those involved and to pursue recovery proceedings against both Pakistani and foreign companies. The ruling placed former Minister for Water and Power and later Prime Minister Raja Pervaiz Ashraf, who became widely associated with the political nickname “Raja Rental”, under intense legal scrutiny. The Supreme Court subsequently directed NAB to proceed against Raja Pervaiz Ashraf and other individuals connected with the Rental Power case and to produce the accused before the Court in accordance with law. The matter created an extraordinary political and institutional confrontation because the case involved a sitting Prime Minister. At the time, NAB Chairman Fasih Bokhari resisted immediate arrest proceedings, maintaining that the available evidence was incomplete and that further investigation was required. This led to serious tensions between the Supreme Court and NAB, including proceedings relating to compliance with the Court’s orders. One of the most disturbing and tragic episodes connected with the Rental Power investigation was the mysterious death of NAB Assistant Director Kamran Faisal. Kamran Faisal was one of the investigating officers associated with the Rental Power case. Reports and allegations at the time suggested that investigators were facing significant pressure in connection with the case and its sensitive political implications. On January 18, 2013, Kamran Faisal was found dead at the Federal Lodges in Islamabad, with his body reportedly hanging from a ceiling fan. Authorities initially treated the case as a suicide, but the circumstances surrounding his death generated widespread suspicion and intense debate among the public, judiciary and media. Allegations were raised that his death might have been linked to pressure surrounding the investigation, although the circumstances remained highly controversial and disputed. His death added another deeply troubling dimension to the Rental Power scandal. Following the Supreme Court proceedings, NAB filed a number of references involving Raja Pervaiz Ashraf, Shaukat Tareen, former Finance Minister, Ismail Qureshi, Shahid Rafiq, Tariq Nazir, and other senior bureaucrats, officials and technical experts.The Supreme Court judgment represented an important attempt to examine allegedly irregular agreements, protect public funds and reinforce constitutional accountability. However, the political pressure that followed, the mysterious death of investigating officer Kamran Faisal, and the subsequent international arbitration proceedings transformed the Rental Power controversy into one of the most complicated episodes in Pakistan’s energy, political and judicial history. After years of legal proceedings, changes to accountability laws and difficulties relating to evidence, accountability courts during 2020 and 2021 acquitted Raja Pervaiz Ashraf and several other accused persons in the major Rental Power references. (To be continued. The remaining discussion will follow in the next episode.)
