Speaking at a dinner hosted in his honour by the Karachi Chamber of Commerce and Industry on Saturday, Federal Privatisation and Investment Minister, Dr Abdul Hafeez Shaikh sought to prompt its members to form a consortium or a business group and come up with a bid for the privatisation of the Karachi Electric Supply Corporation (KESC), which he said is scheduled before June.
While so advising them, he made a pointed reference to the tremendous potential and scope of the KESC - a monopoly market of some 12 million consumers. Basing his idea on the potential of the market alone, he sounded quite optimistic about its feasibility, and suggested that by acquiring the long distressed utility they could also help take the metropolis out of its persisting power woes in a big way.
Maybe, the idea came as a pleasant surprise to some. However, generally speaking, the city businessmen had every reason to take the tip as a piece of melancholy humour under the circumstances.
For, dilating upon its prospects, the minister seemed to have vigorously tried to dispel the impression of the plethora of serious obstacles still impeding privatisation of the KESC.
This, of course, has reference to his assertions regarding serious efforts being made in that direction, pointing out that four expressions of interest (EoI) had already been received.
Of course, there can be no disputing the seriousness with which the government has been pursuing its privatisation programme to varying degree of success, in accordance with the commitment to the multilateral financial institutions, including the International Monetary Fund and the Asian Development Bank.
It was only a month ago when a team of the IMF led by Milan Zavadjil, IMF Division Chief in the Middle East and Central Asia Department, had asked the country's economic managers to improve public sector electricity utilities' financial position, besides expediting unbundling of Wapda and subsequent privatisation.
It will also be noted that referring to the financial results of KESC and Wapda the team observed that the improvement had come about largely because of the lowered financial cost and the reduction in oil prices.
The contribution, if any on account of a reduction in transmission and distribution losses that include the all pervading element of power theft also, was only marginal.
Viewed in this perspective, the progress towards privatisation of the power sector entities will be seen as yet leaving a great deal to be desired. Following restructuring of Wapda, formation of several companies, including the Jamshoro Electric Generation Company and the Faisalabad Electric Company is contemplated and these have been marked for privatisation in the current financial year.
It will, however, be noted that, notwithstanding the headway lately made by the Privatisation Commission and despite KCCI President Siraj Kassam Teli lauding it in his address of welcome on the occasion, formidable remains the challenge of privatisation of the KESC.
This, undoubtedly, is owed to the haphazard manner in which its accumulating woes have been attempted to be overcome over long decades.
Many and varied have been the efforts in that direction, but mostly remaining unsuccessful largely because of the complex background of the utility and the peculiarities inherent in the development of the megalopolis as well.
All in all, the predicament of the KESC will be seen as deteriorating, instead of alleviating from the various thrusts to remedy it.
This unfortunately includes, among other measures, the induction of the Army towards that end. Reeking of corruption and worsening with abuses of trade unionism and mal-administration over a long past, its typical woes from increasing cost of production and comparatively depleting earnings have virtually turned KESC into a lost entity.
The only way out, as repeatedly determined, lies in lowering the cost of production and cutting down of the severe line and distribution losses through an all-encompassing thrust.
These remedies have been variously tried from loosely knit approaches but to little avail. All in all, it will thus be noted that a whole new brave exercise will be needed before KESC can be hopefully prepared for really successful privatisation.
Toying with ideas like the induction of private sector in the effort will remain nothing short of futile attempts.