Islamabad (Khyber Mail): Federal Minister for Privatisation, Fawad Hasan Fawad, held a meeting today with Mr. Najy Benhassine, the Country Head of the World Bank in Islamabad, to discuss the strategic agenda for privatization by the caretaker government.

The focus of their discussions was on the privatization of Pakistan International Airlines (PIA) and other State-Owned Enterprises (SOEs), particularly the Distribution Companies (DISCOs), to improve their performance and address substantial financial losses.

Minister Fawad stated that the federal government and all relevant institutional stakeholders have unanimously agreed to privatize major loss-making SOEs that are already on the privatization list. These SOEs have been a significant drain on government resources. PIA has been identified as a top priority for privatization due to its consistent and substantial annual financial losses, amounting to billions of rupees. Privatizing PIA is seen as crucial to mitigate these losses and enhance operational efficiency.

Minister Fawad outlined the PIA privatization plan and expressed the government’s intention to involve the World Bank and other financial institutions in the initial stages of this effort. The primary goal is to attract private investment through the privatization process, freeing up government funds for essential sectors.

Additionally, the Minister mentioned the intention to develop a comprehensive model for PIA, with the World Bank being a potential key partner for support.

The Federal Minister also discussed the financial challenges posed by the DISCOs, which currently incur substantial annual losses of $2.5 billion.

Two productive sessions with the International Finance Corporation (IFC) have already taken place, focusing on devising a long-term concession model to address these losses.

Ongoing discussions with the IFC are expected to result in a concrete strategy for private sector involvement in the DISCOs, aimed at reducing losses and enhancing performance.

The meeting also covered areas such as advisory and legal assistance, considered crucial for the successful execution of the privatization process.

The meeting concluded with a commitment to mutual cooperation in addressing the financial challenges posed by PIA and DISCOs.

This dialogue highlights the government’s dedication to addressing the financial obstacles created by underperforming SOEs and its active pursuit of the World Bank’s support and collaboration throughout this critical process.

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