Govt eyes quick sell-off of 31 state entities

- File Photo

– File Photo

DAWN, ISLAMABAD, 08th OCTOBER 2013: Chairman, Board of Investment, Mohammad Zubair, has hinted that the process of privatisation of 31 state-owned entities would be completed within 18 months.

Speaking to newsmen here on Monday, the BoI chairman stated that the prime minister wanted completion of the disinvestment process within a year or so.

The government has entrusted the task of working out the privatisation plan to the Privatisation Commission.

Since 1991, 167 transactions have been completed at a sale price of Rs476.42 billion.

Currently, there are 65 entities on the agenda for privatisation, and 31 units on which the cabinet committee took decision are on active list, and announced as part of the understanding reached with the IMF.

After being disinvested, all such units would be able to perform in a better way with new technological innovations and management training.

The disinvestment would be carried in a conducive environment where investment can flourish and transparency is visible, he said.

“It’s a business decision,” and the government is looking for strategic partners in disinvestment of state-owned enterprises, Mr Zubair said.

Speaking about the liabilities of units in line of privatisation, he said the government would sell the balance sheet, and no liabilities would be involved.

As far as Pakistan Railways is concerned, the government will develop a comprehensive restructuring plan, and the railways will be converted from a government department to a state-owned limited liability company which means partial privatisation.

Aging and shortage of equipment, overstaffing and large debts continue to weigh on railway operations.

The government recently the Privatisation Commission to immediately start the process for sale of 31 public sector entities (PSEs) through initial and secondary public offering and transfer of 26 per cent shares, along with management control, to the private sector.

The companies cleared for divestment include the Oil and Gas Development Company Limited, Pakistan Petroleum Limited, Mari Gas, Pak-Arab Refinery, Pakistan State Oil, Sui Southern Gas Company Limited, Sui Northern Gas Pipelines Limited, Pakistan International Airlines, PIA-Roosevelt Hotel, New York, Pakistan Railways, Gujranwala Electric Power Company, Lahore Electric Supply Company, Islamabad Electric Supply Company, Faisalabad Electric Supply Company, Northern Electric Generation Company, Pakistan Steel Mills, National Power Construction Company and Pakistan National Shipping Corporation.

The financial sector entities selected for sale in the first phase include National Bank of Pakistan, First Women Bank, Small and Medium Enterprises Bank, National Investment Trust Limited, National Insurance Company Limited, Pakistan Reinsurance Company Limited, State Life Insurance Corporation and House Building Finance Corporation.

The Civil Aviation Authority, Karachi Port Trust, Port Qasim Authority and National Highway Authority are also on the list.

The government has made a commitment with the IMF to announce a strategy for the sale of 30 firms by the end of September as a benchmark for disbursement of second tranche of the IMF loan. Under the commitment, the government is to announce privatisation plans for remainder of total 65 entities by the end of 2013.

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