Pakistan Senate panel reviews progress on SOEs privatization

A meeting of the Pakistan's Senate Standing Committee on Privatization, chaired by Senator Afnan Ullah, was held to assess the implementation of prior recommendations and to review progress on state-owned enterprises' (SOE) privatization.

During the session, the privatization secretary revealed that Pakistan International Airlines (PIA) has a pension liability of approximately PKR 14.8 billion, with pensions currently being paid to 6,625 retired employees. Highlighting the inadequacy of these pensions, Chairman Afnan Ullah noted that some retirees receive as little as PKR 6,000 to 7,000 per month.

The committee expressed concern over pension disbursements and requested detailed records on pensioners and payment structures for the next meeting.

Privatization process

The Privatization Division secretary reiterated that it is not the government’s role to run businesses, stating that the state is gradually withdrawing from commercial activities.

Currently, 84 government-owned entities remain under state control.

Among these, the Pakistan Mineral Development Corporation (PMDC) has not yet been included in the privatization list, though it was discussed during the meeting.

Senator Bilal Ahmed argued that the PMDC should be given a chance to explain its operations, while Senator Mohsin Aziz questioned the rationale behind discussing an organization not yet on the privatization list. Chairman Afnan Ullah clarified that the Petroleum Division has suggested including PMDC, and the committee has summoned PMDC officials to the next session for clarification.

The Ministry of Privatization advisor emphasized that before any decision is made, an evaluation is conducted to determine whether an entity is strategic or essential in nature, and whether privatization would be viable or necessary.

Power sector privatization

The committee also discussed the privatization of power distribution companies (DISCOs). According to the Privatization Division briefing, 11 out of the 24 entities currently on the privatization list are DISCOs, most of which are operating at a loss, though some are profitable and also being privatized.

In the first phase, the privatization of three companies — IESCO (Islamabad Electric Supply Company), GEPCO (Gujranwala Electric Power Company), and FESCO (Faisalabad Electric Supply Company) — is under active consideration.

Officials from the Power Division shared that out of the 1,416 total properties owned by all DISCOs, these three companies hold 450 properties. However, only 288 properties have been officially transferred to their names, while 162 properties are still pending transfer. The remaining transfers are currently in process, a necessary step before finalizing any sale.

Officials also reassured the committee that bidders participating in the privatization of DISCOs are experienced players in the power sector, aiming to ensure a smooth transition and improved service delivery.