The government has admitted in Letter of Intent (LoI) that privatisation program has experienced some delays as a result of which the number of transactions planned for the next twelve months has increased. According to the review report, the bidding process of Pakistan Steel Mills, PIA, State Life Insurance Corp (SLIC), Kot Addu Power Company (Kapco), Mari Petroleum Ltd, Faisalabad Electric Supply Company (Fesco), Northern Power Generation Company Limited (NPGCL), Islamabad Electric Supply Company (IESCO), Lahore Electric Supply Company (Lesco) and Jamshoro Power Generation Company Limited (JPGCL) is expected to be completed in the current year.
The government has developed restructuring plans for PSM, PIA and Pakistan Railways (PR). The IMF observed that a Presidential Ordinance has amended the Pakistan International Airlines Act. Privatisation of PSM has been put on hold as the company was offered to a provincial government. "Should this offer be declined, the authorities are optimistic that the privatisation process can be completed by end-September 2016," the report states.
According to new schedule of bidding process, Faisalabad Electric Supply Company (Fesco), Islamabad Electric Supply Company (Iesco) and Lahore Electric Supply Company (Lesco) will be completed by end-June 2016 leading to finalisation of the transaction by end- September 2016. The government is also optimistic to complete the bidding process of Gujranwala Electric Power Company (Gepco), Hyderabad, Peshawar, Quetta, Sukkur, and Multan Electric Supply Companies (Hesco, Pesco, Qesco, Sepco, and Mepco) in 2016 and 2017.
The government is scheduling completion of the bidding process of Northern Power Generation Company Limited (NPGCL), Jamshoro Power Generation Company Limited (JPCL), Lakhra Power Generation Company Limited (LPGCL) and Central Power Generation Company Limited (CPGCL) by end-September 2016 with finalisation of the transaction by end-December 2016.
Despite a delayed start due diligence process of Kot Addu Power Company (KAPCO) has been initiated with expected completion of the bidding process for the sale of the government''''s equity by end-June 2016 and finalisation of the transaction by end-September 2016.
The government has identified ten companies in the oil and gas, banking, and insurance sectors for block sales and primary or secondary public offerings. It already sold minority stakes in United Bank Limited (UBL), Pakistan Petroleum Limited (PPL), Allied Bank Limited (ABL) and Habib Bank Limited (HBL).
Despite a slight delay, the government is expected to offload minority shares in State Life Insurance and Mari Petroleum Limited by end-June 2016. On the other hand, Pak Arab Refinery Limited (PARCO) will likely be removed from the list of PSEs to be privatised to consider alternative options. The Cabinet Committee on Privatisation (CCoP) initially approved a list of 31 Public Sector Entities (PSEs) for action and subsequently added another 8 PSEs to the list. A plan has been developed to sequence the capital market and pre-privatisation restructuring for these firms.