Placement of SOE officials in govt departments raises impartiality concerns

In a controversial move, Pakistan’s Ministry of Energy (Petroleum Division) is placing state-owned enterprise (SOE) officials in roles in key policy-making departments, sparking concerns over conflict of interest and undermining regulatory impartiality. 

Industry insiders argue that these placements risk creating biased decision-making in favor of SOEs, stalling reforms essential for the energy sector’s recovery, despite a 2020 directive from the Petroleum Division aimed to return SOE officials to their companies to maintain the integrity of government operations. 

However, the recent move involves placing six officers from Oil and Gas Development Company Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Interstate Gas Systems (ISGS) within government roles, with the ministry citing a lack of professional human resources as justification.

Experts fear these placements could cripple an energy sector already facing structural challenges, diminishing investor confidence and stalling private sector growth.

Industry leaders stress that allowing SOE dominance in regulatory departments effectively sidelines private sector actors, distorting the competitive landscape and blocking essential reforms.

International players, including Shell and BP, have exited Pakistan, frustrated by an uneven regulatory environment that prioritizes SOE interests.

Industry experts argue that Pakistan’s continued reliance on state-owned companies in regulatory roles could exacerbate this trend, further isolating the country from foreign investment and innovation in the energy sector.