The recently concluded privatisation of Pakistan Telecommunication Company Limited (PTCL) and acquiring its 26 percent shares and management control by Etisalat of the United Arab Emirates (UAE) has brought good tidings to the privatisation process. The confusion prevailing in the privatisation of Karachi Electric Supply Corporation (KESC) was a damper to the spirit and brokerage houses and other players in the field had their fingers crossed in anticipation.
The withdrawal of offer by the Kanooz al Watan Company of Saudi Arabia was regarded as a barometer of the general economic and political situation in Pakistan. Some insiders indicated that the Saudi company had backed out of its commitment after getting wrong signals from the country and they thought it was not worthwhile to go for the venture. The stock market was having jitters and confidence of the business was being eroded and the future of the privatisation looked bleak.
The UAE-based Etisalat, which had bid for PTCL for 2.6 billion dollars, paid 10 percent of the bid money amounting to 260 million dollars. It deposited 220 million dollars with the National Bank of Pakistan (NBP) on June 30. The same amount was credited in the State Bank of Pakistan (SBP) account. The company had already paid 40 million dollars as earnest money. This payment has changed the scenario and now other companies are again being attracted towards opportunities for investment in Pakistan..
In the meantime, Privatisation and Investment Minister Dr Abdul Hafeez Sheikh informed the press that the Mustehkam Cement would be privatised in July, saying the other companies in line are Pakistan State Oil (PSO), Pakistan Petroleum Limited (PPL) and National Investment Trust (NIT). More privatisation will follow, and the Karachi Shipyard, Pakistan Steel, Jamshoro Power Plant, and Faisalabad Electricity Board would come under the hammer, he added.
The Etisalat is a financially sound company with a strong infrastructure and backing of the UAE government. It is generally believed that it would manage the company in such a way that would not only bring more profit to the company, but also make it well-disciplined and transparent. Its success would be a test case for other companies to measure their own success.
The opponents and advocates of privatisation process would be watching further developments.