Gov't can save Rs600bn annually by privatizing loss making SOEs

ISLAMABAD: Minister for Privatization Daniyal Aziz Wednesday said the government could save Rs 600 billion annually by privatizing the loss making State Owned Entities (SOEs) including Pakistan International Airlines (PIA) and Pakistan Steel Mills (PSM).

Briefing the National Assembly Standing Committee on Privatization, the minister informed that the annual losses of ailing public sector enterprises have swelled to an unprecedented level, increasing the importance of restructuring and private sector participation to ease pressure on the fiscal deficit.

He said the government has extended bailout packages to PSM amounting to Rs 76 billion including employees' salaries, as of August, 2017, however total debt and accumulated losses of PSM stood at Rs 99.4 billion and Rs 176.6 billion as of June 30, 2017, respectively.

The meeting was presided over by MNA Imran Ahmad Shah and was attended by Sardar Ashiq Hussain Gopang, Justice (Retd) Iftikhar Ahmed Cheema, Choudhary Iftikhar Nazir, Lt Col. (retd) Ghulam Rasul Sahi, Munaza Hassan, Imran Khattak, Abdul Waseem, Engineer Mohammad Usman Badini and Maiza Hameed.

Meanwhile, briefing the committee, Director General of Privatization Commission said the government has provided guarantees amounting to Rs 161.5 billion on behalf of PIA as of June 30, 2017, whereas toatl borrowings and accumulated losses of PIA amount to Rs 186.5 billion and Rs 316 billion as of December 31, 2016.

He said currently a total of 70 SOEs are on active list of privatization which have been approved by the Cabinet Committee on Privatization out of which 42 entities are included in the privatization programme for early implementation.

He said the government was not entitled to indulge in trade and business activities therefore it is bent upon privatizing its entities in larger interest of the country and its people.

He said after introduction of new act, the privatization process has now been made more transparent.

Meanwhile, briefing the committee, an official of the ministry informed that during current government's tenure privatization process of 26 entities was initiated out of which five transactions including that of UBL, PPL, ABL, HBL, and NPCC have been completed.