PC to start process of privatising major state sector units in June
By Ihtasham ul Haque
ISLAMABAD, Feb 23: The Privatisation Commission (PC) plans to undertake from June this year a process of privatising some major units, including PIA, Pakistan Railways, Civil Aviation Authority (CAA), ports and airports.
“Now when we are all set to complete most of the ongoing transactions by the end of the current financial year, preparations are afoot to start the process of disinvesting big public sector entities from next June," Minister for Privatisation and Investment Zahid Hamid told Dawn.
Responding to a question, he said that according to a decision taken by the Council of Common Interest (CCI) in 1997, all large or small public enterprises would be privatised to make them efficient and avoid huge losses every year.
"But before that we plan to complete our various ongoing transactions in a most transparent manner so that nobody could challenge them later at any stage," Mr Hamid said. He claimed that all the transactions so far completed by the PML government conformed to rules and legal procedures.
Giving details of current transactions, the minister said that the initial public offering of the Habib Bank Limited (HBL) would be completed by June 2007. Similarly, the global depository receipt of the United Bank Limited (UBL) and Kot Addu Power Company (KAPCO) will also be completed by the end of the current financial year.
Mr Hamid said that a data room for the privatisation of Pakistan State Oil (PSO) would be set up in March and its bidding would take place in April. The entire transaction was expected to be completed by June this year after full payment made by the new buyer.
The minister did not give any reference price for PSO and said: "Let this be determined by the market forces." About the Pakistan Petroleum Limited (PPL), he said that various issues were currently being discussed with the Balochistan government to complete the transaction.
Answering a question, he said that legal matters pertaining to the disinvestment of the National Bank of Pakistan (NBP), which also conducts the treasury functions for the government, would be finalised soon. The central bank, he said, will be proposing certain legal amendments for the privatisation of the NBP.
"Then the Heavy Electrical Complex (HEC), Hazara Phosphate, National Power Construction, National Investment Trust (NIT), Small and Medium Enterprise (SME) Bank, coal and salt mines of the Pakistan Mineral Development Corporation (PMDC) will also be privatised within the current financial year for which financial advisers were being appointed.
Asked about the delay in the privatisation of the Sui Southern Gas Company (SSGC) and Sui Northern Gas Pipeline Limited (SNGPL), he said some technical issues, including those related to tariffs, were yet to be sorted out to complete.
He said that strategic shares of the Jamshoro Power Company would be offloaded by June this year for which various formalities were currently being completed.
However, he said a proposal to privatise the Heavy Mechanical Complex (HMC) has been dropped.
Asked about the Pakistan Steel Mills (PSM), he said that the federal government had filed a review petition in the Supreme Court and a decision would be taken after the apex court’s verdict.
In reply to a question, the minister said that since 1991 about $7 billion had been collected on account of selling various public sector entities, which also included $6.1 billion raised during the last seven years of the present government. "It means 87 per cent of funds were collected by our government," he said, adding that 61 transactions had been completed during this period.
Asked about investment, Mr Hamid said that over $3.5 billion in foreign investment had reached Pakistan during the first seven months of the 2006-07 financial year. "But for the entire current financial year we are expecting $6 billion plus in foreign investment," Mr Hamid added.
He said that the image of the country had greatly improved over the past few years which helped attract considerable foreign investment. "Foreign investors are finding Pakistan a good destination for investment," he said.
“Most of the foreigners investing in the country are Americans," he said, adding that negative travel advisories issued from time to time by the United States and some European countries were not creating any serious adverse impact.
