Failure in transferring properties: government will not get $800 million from Etisalat: PC chief

The government would not get US$800 million from Etisalat for privatisation of Pakistan Telecommunication Company Limited (PTCL) due to its failure in transferring 34 properties to the buyers. Chairman Privatisation Commission Muhammad Zubair further disclosed that there was a huge difference in prices of these properties after their evaluation by the government and Etisalat.
As per the government evaluation, the cost of these properties was $92 million whereas Etisalat has come up with an assessment cost of $400 million. Zubair told a Senate sub-committee on Finance chaired by Senator Talha Mehmood that "now Etisalat will not give us the remaining $800 million in full on privatisation of PTCL". He further stated that Privatisation Commission has written a letter to Etisalat for settlement of dispute lingering for the last eight years. The government was required to transfer 3500 properties to Etisalat as per agreement for privatisation of PTCL but has only transferred 3466 properties. He further stated that Israeli and Indian companies are not allowed to make investment in Pakistan but investment made through equity fund is not possible to detect. Zubair said that anyone who purchases more than 5 per cent shares could get approval from State Bank of Pakistan (SBP) and Securities Exchange Commission of Pakistan (SECP). The meeting of sub-committee was held to take up the Privatisation Commission Amendment Bill 2013 moved by Senator Sughra Imam.
The sub-committee recommended the post-audit of privatisation transactions to ensure transparency and expressed displeasure that Finance and Water and Power ministries have been reluctant to present the audit report of clearance of Rs 500 billion circular debt to the committee. Senator Sughra Imam said that circular debt would not have resurfaced if audit of power generation companies was conducted. The committee members also expressed their concern over use of privatisation proceeds for meeting budgetary expenditure instead of debt retirement.
A bill to amend the Privatisation Commission Ordinance, 2000 seeks that privatisation process in Pakistan must be entirely transparent and conducted in a manner that will protect Pakistan's economic and strategic interests, both in the short- and the long-term. The privatisation process must, therefore, be improved to guarantee greater efficiency, openness and transparency in every transaction. Pakistan's strategic assets and national security interests must also be safeguarded and secured during this process. The senator wants amendment in section 5 of the ordinance to ensure that all privatised assets, shares and enterprises are not further sold to another bidder without prior approval of the Federal government and its concerned agencies. Other amendment proposed in the law is aimed at ensuring that the natural resources can only be privatized through granting operational rights for a certain period of time and not through granting ownership rights and that the proceeds of privatisation will only be used for debt retirement and not for general budget expenditure or investment.