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Inside Asia: Turning on the Lights in Pakistan

July 1, 2013 by Leave a Comment

KARACHI, Pakistan — Since Pakistan’s biggest electricity company was privatized, its headquarters has been looted, its employees kidnapped and its boss nearly arrested by the government.

Despite all of that, it is regarded as a roaring success.

Power cuts lasting 12 hours a day or more have devastated the Pakistani economy. The loss of millions of jobs has fueled unrest in a nuclear-armed nation already beset by a Taliban insurgency.

The only city bucking the trend is the violent metropolis of Karachi, Pakistan’s financial heart — and that is thanks to Tabish Gauhar and his team at the Karachi Electricity Supply Co.

“It has consumed every ounce of my energy,” Mr. Gauhar, 42, said in an interview. “But we have helped millions of people.”

The new government of Prime Minister Nawaz Sharif won an election in May partly because it had promised to fix the power cuts. Now many are wondering whether the Karachi utility’s successful privatization will be repeated elsewhere.

Pakistan’s power companies share similar problems. Workers are often corrupt, and influential families rarely pay bills. The government sells power below the cost of production but pays subsidies late or not at all. Plants cannot afford fuel.

At the state-run Peshawar Electricity Supply Co., the majority of workers are illiterate, most new hires are relatives of existing staff members, and 37 percent of the power generated was stolen, according to a 2011 audit funded by the U.S. Agency for International Development.

Karachi Electricity Supply had all the same problems when the Dubai-based private equity firm Abraaj Capital bought a controlling stake in 2008. Mr. Gauhar and his Abraaj team decided to slash the work force by a third, cut off nonpayers and destroy illegal connections.

The moves started a small war.

Employees who had been laid off offered to work for free because they had made such fat kickbacks. When management refused, thousands of protesters ransacked the company’s headquarters. They camped outside for months.

Gunmen attacked Mr. Gauhar’s house. Workers crossed picket lines every day, hunkered down on the floors of police cars. More than 200 employees of the utility were injured.

“We felt very lonely then,” said Mr. Gauhar, who moved from chief executive to chairman of Karachi Electricity Supply earlier this year. “When I used to visit one of our injured employees in the hospital, it was hard for me to look them in the eye.”

Many in the populist pro-labor government vilified the power company. Later, legislators tried to arrest Mr. Gauhar on charges that he had not attended subcommittee meetings in the capital.

After the protests dissipated, Karachi Electricity Supply’s next problem was making customers pay. More than a third of the company’s electricity was stolen in 2009. Those who got bills often ignored them.

One wealthy patriarch said he could not possibly start paying because his colleagues would think he had no influence left.

Karachi Electricity Supply started cutting off those who did not pay their bills. When a transformer burned out in an area with high theft, the company asked for two months’ worth of payment from the area’s residents before replacing it.

The company divided up the city of 18 million. Areas where 80 percent of people pay bills now have no regular power cuts. Areas with high loss — often crime-ridden, sweltering slums — have long power cuts. Karachi Electricity Supply is widely hated in such places.

Muhammed Fayyaz, who works as a driver, says his neighborhood often has as much as 10 hours of cuts per day. Summer temperatures top 40 degrees Celsius (104 Fahrenheit), and protests are frequent.

“People block the main road and throw stones at passing vehicles,” he said.

Mr. Fayyaz lives in a high-theft area. Stealing power is easy. Makeshift wires with metal hooks festoon Karachi Electricity Supply’s lines in the sun-baked streets. Some lead to roadside businesses. Others head into the distance atop lines of makeshift bamboo poles.

“We clean them up, but in five minutes they are back again,” said Muhammad Siddiq, a manager at the utility.

Article source: http://www.nytimes.com/2013/07/02/business/global/turning-on-the-lights-in-pakistan.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Charlie Rose and Gayle King in CBS ‘Early’ Plan

November 11, 2011 by Leave a Comment

The network is putting the finishing touches on a two-hour news show, expected to be announced in New York next Tuesday, that will defy the gauzy conventions of morning television. It will emphasize hard news and use a conversational approach like “Morning Joe” on MSNBC and “The View” on ABC.

Starting sometime early next year, Mr. Rose, Ms. King and other new hires will join two of the current co-hosts, Erica Hill and Jeff Glor, on a new set that is being built on the West Side. More than half a dozen CBS staff members described the plan on the condition of anonymity because they were not permitted to discuss it publicly yet.

CBS declined to comment on the record about the impending changes.

Privately, executives say that because the network has forever failed to beat NBC’s “Today” and ABC’s “Good Morning America” by imitating those shows, they are comfortable trying something wholly different.

The plan already is the talk of the tight-knit, gossipy New York television news industry. But will it be talked about anywhere else?

Neither Mr. Rose, who hosts the long-running interview series “Charlie Rose” on PBS, nor Ms. King, who hosts a morning talk show on OWN, the cable channel of her best friend, Oprah Winfrey, are proven ratings draws.

“Charlie’s an incredibly talented guy,” said a senior executive at ABC. Asked about what this might mean for ABC’s position in the ratings, this person added, “people are doing a happy dance over here.”

Within the industry, opinions on the plan range from skeptical to downright dismissive, though few will share their comments on the record for two reasons: Mr. Rose is a personal friend to many, while others want the hard news strategy to work, even if they highly doubt that it will.

One such friend, a journalist who works at a competitor of CBS News, said a morning show led by Mr. Rose would aim at an “older, settled demographic,” turning a loss leader for the network into a virtue. “Even if viewership is marginal,” the person said, “it would at least give them the promotional opening to say, ‘We’ve put the news back in morning news, and we’ve decided to offer some thoughtful, mature conversation in the morning.’ ”

Conversely, CBS executives are said to believe that such an approach will attract viewers, not repel them.

The two men who took over CBS News early this year — the “60 Minutes” producer Jeff Fager, who is chairman, and the former Fox News executive David Rhodes, who is president — have steered the news division in a more serious direction.

They have cited ratings gains on the third-place “CBS Evening News” and Sunday’s “Face the Nation” as evidence that it is working. “The Early Show,” however, is down 6 percent this fall from the same time period last year.

For decades, CBS has tried different combinations in the morning, with relatively little to show for it. In 1999, it hired Bryant Gumbel, formerly of the “Today” show. A year ago, it dismissed almost all of the co-hosts and started over from scratch with Ms. Hill. What matters more than anything else, current and former morning producers say, is the chemistry between co-hosts, and CBS has never mastered that piece.

Leslie Moonves, the chief executive of the CBS Corporation, met with CBS News executives this week to review the latest remake, which may or may not retain the name “The Early Show.” The plan calls for Mr. Rose, who has contributed in the past to the network’s most popular program, “60 Minutes,” to help lead the 7 a.m. hour with Ms. Hill, who joined CBS from CNN in early 2010.

Article source: http://feeds.nytimes.com/click.phdo?i=1c1daa549b5af4ef119ab8861802c68a

Filed Under: Business News Tagged With: , ,

Economix: Making Hiring Cheaper

June 14, 2011 by Leave a Comment

On Friday, I wrote about how equipment and software prices are getting rapidly cheaper while the cost of labor has been getting more expensive, making capital a more attractive investment to companies than people. Tax incentives that encourage earlier capital investment may be helping, too.

In the past week, there has been some buzz about creating similar tax incentives that would subsidize labor, such as allowing employers to forgo paying their share of payroll taxes for any net new hires.

Reuters and Bloomberg News reported, for example, that the White House is considering such a proposal. Times reporters had been hearing, though, that the idea was not yet seriously under discussion.

Then today, Larry Summers, who until recently served as President Obama’s top economic adviser, wrote in The Washington Post that he believes employers should get a payroll tax cut, although he did not specify whether the tax cut should be applicable to new hires only.

On its face, a payroll tax cut should have bipartisan appeal: It helps unemployed people, which pleases Democrats, and it cuts taxes for businesses, which pleases Republicans. A similar tax cut implemented in the 1970s also has received generally favorable evaluations from economists.

One possible reason this idea has not gotten much traction lately, though, is that Congress passed a temporary job creation tax cut last year that does not seem to have been terribly effective. It had some major design flaws, and was not well-publicized. If employers don’t know about a hiring tax incentive, it’s not going to have any impact on their behavior.

On the other hand, it’s entirely possible that Washington is considering such a tax incentive but loath to loudly advertise it. After all, long drawn-out discussions could end up worsening the job market if they encourage employers to delay hiring and wait for the best possible deal.

Article source: http://feeds.nytimes.com/click.phdo?i=5e7b0182b7c49f81b2969ded1994e831

Filed Under: Economy News Tagged With: , ,