ISLAMABAD: The Cabinet Committee on Privatisation (CCoP) on Thursday removed Pakistan National Shipping Corporation, Port Qasim Authority and Karachi Port Trust from the privatisation list due to the strategic importance and profitability of these entities.
However, the committee directed the Ministry of Privatisation to expedite the privatisation process of approved public sector enterprises (PSEs).
The CCoP meeting, chaired by Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh, decided to empower the Ministry of Privatisation to select any 10 PSEs for hiring of financial advisers, collectively or separately as per requirement, for the selected units.
Hafeez said the government was committed to pursuing the privatisation programme and assured the ministry of full institutional backing and requisite resources to fast-track the process.
Earlier on June 3, the cabinet in its meeting had already approved initiation of the process of hiring of financial advisors of the selected 32 properties.
The privatisation ministry gave a detailed presentation on the ‘Status of Overall Privatisation’. The committee was informed that the privatisation process started in January 1991 and a total of 172 transactions had been completed having fetched a total of Rs649.3 billion for the national exchequer.
The committee was also briefed on the progress and pace of privatisation of eight units being on the active list, including National Power Parks Management Co. Ltd (1,223 MW Balloki Power Plant and 1,230 MW Haveli Bahadur Power Plant; Mari Petroleum Limited; SME Bank Limited; First Women Bank Limited; Services International Hotel Lahore; Jinnah Convention Centre Islamabad; Lakhra Coal Mines (now Lakhra Coal Development Company) and the revival of Pakistan Steel Mills through the public-private partnership mode.
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Paradoxically, the Port of Gwadar was not deemed strategic enough to be given under full Chinese control and management. But the PQA, KPT and the PNSC are somehow considered highly strategic. What about PIA and Pakistan Steel Mills?
By this strange logic all these loss-making entities should continue bleeding billions and blow up the national debt and deficit.
By definition, of the Privatization Committee all these highly leveraged, unproductive and unprofitable ventures are strategic and therefore untouchable for the purpose of sale. That is neither prudent nor sustainable in the long run.
However, even the so-called strategic assets can be successfully turned around under public-private partnership provided the partnership is operated by a fully autonomous professional management team given free hand, without any meddling by Ministry of Privatization once the terms of reference are outlined by the partners and the scope of work and time frame for the turnaround is agreed upon. The key point is whether or not the Ministry of Privatization is willing to empower the new partners to do what needs to be done. Probability of that is close to zero.