The World Bank has issued a report, which is in fact an indictment of Pakistan’s state-owned enterprises (SOEs). According to this report that has been widely broadcast and published by media, Pakistan’s SOEs are the worst in entire South Asia and their combined losses growing faster than assets, resulting in a significant drain on scarce public resources and posing a substantial risks to the sovereign. That this report is spot on is a fact.
In my view, Pakistan International Airlines (PIA), Pakistan Steel Mills (PSM) and Pakistan Railways (PR) can rightly be described as white elephants, causing a huge burden on the national exchequer in a big way.
Successive government —civil and military alike — have paid little or no attention to the ailing SOEs, turning them into massive employment bureaus, much to the chagrin of the national kitty.
Pakistan People’s Party (PPP) governments in particular played the principal role in the virtual bankruptcy of these SOEs. Most of the SOEs have not fostered their profitability, investment and growth over the past many years. Moreover, PSM, the country’s largest industrial unit, is shut for any manufacturing work since 2015 but the federal government has to arrange salaries of employees and meet its other expenditures obligingly.
Most of the SOEs are required to be privatised without any further loss of time. Given the reluctance on the part of the government to take this course, SOEs may be given greater autonomy.
These SOEs must improve their corporate governance by adjusting their boards and enhancing the powers of these boards to make adjustment and strategic decisions freely without any due or undue government interference in their policymaking processes.
Sulaiman Mirza (Karachi)
Copyright Business Recorder, 2023
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