Massive SOE losses force Pakistan toward privatization

Pakistan’s privatization program is entering a decisive phase. After the successful completion of PIA’s privatization, the largest privatization transaction in Pakistan’s history and the first major SOE sale in nearly two decades, the government is now moving ahead with the sale of more state-owned enterprises.

All local and international regulatory approvals for PIA have been completed, and the airline is expected to be formally handed over to its new owners before the end of the month. The government has also finalized plans for the privatization of three major power distribution companies (DISCOs), including Faisalabad, Gujranwala and Islamabad, while Hyderabad and Sukkur DISCOs are being considered under a long-term concession model.

In this episode, Prime Minister’s Adviser on Privatization Muhammad Ali shares key details about the timeline, transaction structure and broader strategy behind Pakistan’s privatization programme in conversation on On My Radar with Kamran Khan. We also discuss:

• PIA privatization and IMF-approved tax incentives
• DISCO privatization roadmap
• Islamabad Airport privatization plans
• Karachi and Lahore airport outsourcing
• Potential privatization of OGDCL, SNGPL, SSGCL and State Life
• Why SOE reforms have become critical for Pakistan’s economy

With annual SOE losses reaching Rs832.8 billion and accumulated losses exceeding Rs6.56 trillion, the success or failure of this privatization drive could have major implications for public finances, investment and economic reform.