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SOHAIBZUBAIR654@HOTMAIL.COM 02 MADIHA NAWAZ 07 HIRA QAMR 23 MUKARAM ALI KHAN 35 ZOHRA KALSUM
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PRIVATIZATIO N

INTRODUCTION

Privatizationis the process of transferring ownership of abusiness, enterprise, agency or public service from thepublic sector(the state or government) to theprivate sector. refers to transfer of any government function to the private sector, including governmental 4/28/12 functions like revenue collection and

Privatization

GENERALLY PERCIEVED BENEFITS

a)

Development would be faster(due to competition with the other private parties). Innovative solutions (due to again competition with the other private parties). Effective & time bound results.

a)

a)

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GENERALLY PERCIEVED DISADVANTAGES

a)

Always a threat to working staff. As private parties try to extract work from minimum resources, downsizing is the common problem. Un-employment increases. If the private party is inefficient, there is

a)

a)

a)

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PRIVATIZATION IN PAKISTAN

Privatization efforts began in earnest after the creation of Privatization Commission on January 22, 1991. mandate initially restricted to industrial transactions, by 1993 it had expanded to also include Power, Oil & Gas, Transport (aviation, railways, ports and shipping & Telecommunications and Banking and Insurance.

PC

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PRIVATIZATION IN PAKISTAN (1991-2010)

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PRIVATIZATION IN PAKISTAN (1991-2010)

67%

of the proceeds were transferred to the Federal Government. to legal entities whose shares were sold. 5% was used for restructuring expenses. used for PCs

26%

2% was 4/28/12

PRIVATIZATION IN PAKISTAN (1991-2010)

NUMBER

OF PRIVATIZED TRANSACTIONS

HIGHEST NO. OF TRANSACTIONS :

GHEE

MILLS SECTOR = 24

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PRIVATIZATION IN PAKISTAN (1991-2010)

TRANSACTIONS IN MONETARY TERMS

(Rs. in millions)

HIGHEST: TELECOM SECTOR : 187,360

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SUMMARY OF THE PRIVATISATION PROCESS IN PAKISTAN

Identification of an entity for privatization. / Cabinet approval. of CCI.

CCOP

Approval

Appointment

of Financial Advisor (FA) for major transaction(s) with approval of PC Board.

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SUMMARY OF THE PRIVATISATION PROCESS IN PAKISTAN

Screening

- Statement of Qualification

(SOQ).
Pre-qualification.

Due

diligence by potential bidder(s). approved by PC Board and CCOP.

Valuation
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INTERNATIONAL TREND (WORLD BANK ) SNAPSHOT (2000-2008)

Number

of countries with privatization =101 number of transactions=1,835 amount =452,682

Total

Total
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CONSEQUENCES OF PRIVATIZATION
(UNITS SHUTDOWN)
1) 2) 3) 4) 5) 6) 7) 8)

Naya Daur Motors Dandot Cement Zeal Pak Cement National Cement General Refractories Pak PVC Swat Elutriation Nowshera PVC

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PRIVATISATION PROGRAMME UNDER PPP

1.SME

Bank Limited

2.National

Power Construction Company (NPCC) Electric supply Company (FESCO) Electric supply Company (PESCO)

3.Faisalabad 4.Peshawar 5.Quetta

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Electric supply Company

(QESCO)

PRIVATISATION PROGRAMME UNDER PPP

12.Pakistan 13.PTDC 14.Utility

Railways

Motels and Restaurants Store Corporation and Post

stores
15.Pakistan 16.Kot

Addu Power Company (KAPCO) Insurance Company (Ex -

17.National
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PAKISTAN RAILWAY

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Introduction

Pakistan Railways (reporting mark PR) is a national state-owned rail transport service of Pakistan, head-quartered in Lahore. It is administered by the federal government under the Ministry of Railways. PR provides an important mode of transportation throughout Pakistan. It is commonly referred to as the "life line of the country"

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Major routes
Peshawar-Karachi Peshawar-Quetta Lahore-Sialkot Lahore-Faisalabad

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Major stations and junctions

It includes

Peshawar-Karachi line, Peshawar junction, Nowshehra Junction, Rawalpindi, Lalamusa, Gujranwala, Sahiwal, Lahore cantt,

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Passenger:

Passenger traffic comprises 50% of the total revenue annually. PR carries 65million passengers annually and daily operates 228 mails, express and passenger trains. Daily, PR carries an average of 178,000 people. PR also operates special trains during occasions such as Eid ul Fitr, Eid ul Azha and Independence Day.

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Restructuring

In

March 2010, the Pakistani government announced plans to split Pakistan Railways into four privatized businesses; focused on operations

passenger Freight

Infrastructure
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manufacturing

Privatization of PR
Plan of Govt of Pakistan

Reasons of privatization:

Pakistan railway does not even have funds to buy fuel. The biggest problem for Pakistan Railways is the soaring budget deficit. Railways is suffering from huge losses. PR is not allowed to charge a market-clearing price; fares have always been dictated bythe federal government.

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Effects of privatization of PR
Employees

protests against the privatization of Pakistan Railway in different cities.

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Protest in Lahore
Pakistan

Railways (PR) employees protested against the government's privatization plan in Lahore. They also threatened to suspend all trains if the plan was not aborted.

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Protest in Karachi

Pakistan Railways (PR) employees protested against the possible privatization of PR at City Station. The protesters told the media that they will continue their protest until the decision is withdrawn and their demands are fulfilled.

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Protest in Multan
Employees

of PR protests against the privatization of Pakistan Railway and workers blocked the railway tracks.

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PRIVATIZATION OF PR, IS THIS A GOOD DECISION BY DECISION MAKERS?

Major problems of Pakistan Railways
(a) (b) (c) (d)

shortage of advanced locomotives, mismanagement, single railway track lack of technique-oriented staff, including railway minister.

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ACCORDING TO NATIONAL ASSEMBLY

Government has no intention to privatize Pakistan Railways or close its nationwide service, rather steps were being taken to transform it into a profit-oriented entity.

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SURVEY CONDUCTED BY GILLANI RESEARCH FOUNDATION

In

a survey, a nationally representative sample of men and women from across the country were asked the following question: Pakistan Railway has been going in loss for the past sometime. These days privatization of Pakistan railway is under discussion in the cabinet. In your opinion should it be privatized or not?

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RESULT OF THE SURVEY

YES NO
NO RESPONSE

35% 42% 23%

Karachi Electric Supply Company (KESC)

KESC
(Karachi electric supply company) Generates and supplies electric power to Karachi and other small areas around it Provide electricity to over 2.1 million consumers

Privatization Of KESC
finalized Transfer For

in November 2005

of 73% shares and management control Better distribution of electric energy in cost

Reduction

Effects Of Privatization
Ignores

power cuts and focuses on

billing
Plays

havoc with peoples lives

Refuses Korangi KESC

a bill-free june for karachiites plant conks out in chaos

Abdul Rauf Siddiqui calls upon KESC to compensate peoples losses dismay over the Expressed
performance of KESC
To

make good the losses

Billions KESC

of losses to the national industry and trade SHOULD BE HANDED OVER TO THE GOVT AGAIN