PIA tops sell-off list, World Bank told

ISLAMABAD: The Privatisation Commission Thursday discussed the caretaker government’s strategic agenda for privatisation, with specific attention to privatising Pakistan International Airlines (PIA) and other SOEs for optimising the performance of the distribution companies (DISCOs).

A meeting took place between Federal Minister for Privatisation Fawad Hasan Fawad, and Najy Benhassine, the country head of the World Bank, here on Thursday.

This concerted effort aims to rectify substantial financial losses incurred by these entities and thereby, alleviate the fiscal burden on the government.

Govt takes steps for financial relief to PIA

The minister said that the federal government and all institutional stakeholders have unanimously agreed to undertake the privatisation of major loss-making state-owned enterprises (SOEs) which are already on the privatisation list.

These SOEs are responsible for a substantial financial drain on government resources.

The PIA has emerged as the foremost priority for privatisation due to its persistent and staggering financial losses, amounting to billions of rupees annually.

Privatising PIA is considered imperative to remove these losses and improve its operational efficiency.

Minister Fawad Hasan Fawad explained the outlines of the PIA’s privatisation plan, expressing the government’s intention to engage the World Bank and other financial institutions in the initial phases of this effort.

The overarching objective is to attract much-needed private investment through the privatisation process, thereby, unlocking government funds for deployment in vital sectors.

Furthermore, the minister highlighted the intention to develop a comprehensive model for the PIA, with the World Bank remaining a key partner for potential future support.

The federal minister also discussed DISCOs given their substantial annual losses, which currently stand at a staggering $2.5 billion.

Two productive sessions with the International Finance Corporation (IFC) have already been held, focusing on formulating a long-term concession model to mitigate these losses.

Ongoing discussions with the IFC are expected to yield a concrete strategy for private sector participation in the DISCOs, with a prime objective of privatising to achieve loss reduction and performance enhanceament.

The meeting encompassed a broader range of support areas, encompassing advisory and legal assistance.

These aspects are considered crucial in ensuring the successful execution of the privatisation process.

The meeting between Federal Minister for Privatisation Fawad Hasan Fawad and the World Bank Country Head Najy Benhassine ended with a positive resolve of mutual cooperation in addressing the pressing financial challenges posed by the PIA and the DISCOs.

This dialogue demonstrates the government’s unwavering dedication to confronting the financial hurdles posed by underperforming SOEs.

The government actively seeks the World Bank’s support and collaboration throughout this critical process.

Copyright Business Recorder, 2023