LAHORE: With focus on curtailing annual deficit of railways, which is about Rs40 billion, Pakistan Railways is going to run freight service on modern lines and the federal cabinet has approved the appointment of a highly experienced private sector CEO to run Pakistan Railways Freight Transportation Company (PRFTC).
The government’s restructuring plan to make public sector enterprises profitable out of deficit has reached a major milestone as the federal cabinet has initiated the move to hire the private sector CEO to run the PRFTC.
According to details, the Institutional Reform Cell (cabinet division) had recommended through a report in January 2019 to bring in strategic reforms in Pakistan Railways (PR). Out of many points highlighted in this report some issues of governance, organizational restructuring and management and outsourcing of PR trains to the private sector were also included. The report strongly emphasized on freight sector reforms and asks the PR to shift its focus from passenger trains to freight trains with a simple logic that freight trains are commercially viable and generate profits as compared to passenger trains which require high occupancy of around 85% just to reach the breakeven point. The report also pointed out that only 11 freight trains of PR generate 35% of PR revenue while 114 passenger trains generate the rest. Through this equation, the report and directives emphasized the fact that the Pakistan Railways Freight Transportation Company (PRFTC) should handle all freight business of PR and later it was decided to use the expertise of the private sector to make this restructuring project sustainable.
Federal Minister for Railways, Azam Sawati had prioritized improving of the freight service to get the railways out of deficit. In March 2021, through an advertisement in the newspapers, applications were invited for the post of CEO of Pakistan Railways Freight Transportation Company, in response to which approximately 15 candidates expressed interest with extensive experience and expertise in the relevant fields including logistics and transportation.
Copyright Business Recorder, 2021