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August 9, 2019

Strategically important PSEs delisted from privatisation list


August 9, 2019

ISLAMABAD: The government on Thursday decided to exclude three public sector enterprises (PSEs) falling under the ministry of maritime affairs from the privatisation list, citing their strategic importance and profitability as reasons behind the decision.

The Cabinet Committee on Privatisation (CCoP) delisted Pakistan National Shipping Corporation, Port Qasim Authority and Karachi Port Trust from the privatisation program on the request of the ministry of maritime affairs. The CCoP took the decision during a meeting presided over by Adviser to the Prime Minister on Finance and Revenue Hafeez Shaikh.

The committee asked the ministry of privatisation to shortlist at least 10 public sector enterprises for expediting their selloff process through appointment of financial advisers. The committee advised the ministry of privatisation to hire financial advisers for at least 10 PSEs before the next CCoP meeting. It empowered the ministry of privatisation to select any 10 units and start forthwith the hiring of financial advisers, collectively or separately as per requirement, for the selected units.

Shaikh said the government is committed to pursuing the privatisation program and assured the ministry of privatisation of institutional backing and requisite resources to speed up the privatisation process. The cabinet, in its meeting in June, already approved initiation of the process of hiring of financial advisers of the selected 32 properties.

The meeting was informed that the privatisation process started in January 1991 and a total of 172 transactions have been completed, having fetched a total of Rs649.3 billion for the 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 megawatts Balloki power plant and 1,230MW 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 Pakistan Steel Mills (PSM).

Prime Minister Imran Khan earlier this week directed the officials to expedite the process to revive the loss-making PSM.

The government is weighing an option to rejuvenate the state-owned PSM under the public-private partnership mode in phases that were estimated to cost around $800 million. The plant would be revived to achieve its built-in capacity in the first phase within one and a half-year, while the production capacity would be jacked up to three million tons in the second phase.

The PSM shut down its furnaces in 2015 and it consumed almost Rs200 billion of state funds on various heads till last year from 2008 when it used to be a profitable organisation. The government has to pump an estimated Rs400 million every year to pay salaries of the PSM’s employees.

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