ISLAMABAD: The transactions of state-owned entities, including Pakistan International Airlines (PIA) and Pakistan Steel Mills (PSM), under the privatisation programme have been deferred beyond this fiscal year.

This impression was gathered at the end of a presentation given to media by Privatisation Commission Chairman Muhammad Zubair on Friday.

The divestment of 26 per cent government stake in PIA and the strategic asset sales of PSM became highly politicised, dashing hopes for the privatisation of power distribution companies (Discos).

Mr Zubair said bids for the Faisalabad Electric Supply Company (Fesco) were received but the process has been delayed due to the unfriendly environment for privatisation.

The privatisation minister said the government was revisiting its strategy with respect to distribution companies.

Once the government has confirmed a strategy, a decision on the fate of the Fesco transaction would be made, Zubair said.

“We are trying to ensure a conducive environment for reinitiating the privatisation process,” he told newsmen.

“We have taken all stakeholders on board. The work assigned to the Privatisation Commission has been done in a professional manner,” he explained.

He added that PIA and PSM have been on the active list for decades.

The government had earlier informed the International Monetary Fund (IMF) that it would privatise ten public sector entities by the end of December 2016. Transaction of six of the entities had to be completed by the end of fiscal year 2015-16.

These include: State Life Insurance, Kot Addu Power Company, PIA, IESCO and Lesco and Mari Petroleum.

He refuted the notion that PIA assets would be sold cheap.

“Since the PIAC (Conversion) Bill 2015 is pending approval of the Senate, no formal transaction structure has yet been presented to the Privatisation Board and the CCOP for consideration and approval. However, segregation of PIAC core and non-core functions is under consideration,” Mr Zubair said.

It was explained that no valuation of PIA, its real estate properties or business segments has been conducted by the privatisation commission as yet. “As and when valuations are conducted, PC will ensure adherence to the international conventions on valuation,” he added.

Discussing PSM, the minister said that correspondence took place between the privatisation commission and the Sindh government but so far remained inconclusive.

The minister said that despite being provided complete access to PSM site and management, the Sindh government has not been able to provide a definite response to the offer in over four months.

From January 1991 to date, subsequent governments privatised 172 public sector enterprises at a total value of Rs648.6 billion. The highest number of transactions were completed between January 1991 and July 1993 during the first Nawaz Sharif government, fetching Rs12bn against 64 transactions.

Published in Dawn, February 27th, 2016