PIA, the state-owned airline, is at its last stage of the privatisation process, said the minister, adding that they have already been talking to some of the private Chinese Airlines who have shown a lot of interest in this regard. He said they will start the marketing process after resolving some issues so it is being delayed for one to two months.
The minister said there are a lot of investment opportunities in the country and especially for the Chinese investors. The government is talking about the PSM privatisation and it would be on sale in the next one to two months. In September, a road show was carried in China where a lot of positive response was received. The minister said that Pakistan significantly depends on Chinese investment and trade to boost its economy. There are a lot of investment opportunities not only for the local but for foreigners and Chinese investors especially, he said. Pakistan prefers China over other countries because of its ties with China and they needed to be further converted into meaningful economic relations.
There is another way of investment in Pakistan and that is through the privatisation process, said the minister, adding that the objectives of privatisation in the country were to enhance service delivery to the people, strengthen Pakistan's fiscal position, attract private capital, technology and management and deepen Pakistan's capital markets.
There are two modes of privatisation (i) strategic sale/Public-Private Partnership which comprises complete or partial sale of assets and business with transfer of management control, lease, management or concessions contracts and management or employee buyouts; and (ii) capital markets which include sale of shares through a public auction or tender, public offering of shares through a stock exchange, global depository receipts (GDRs) and exchangeable/convertible bonds.
Zubair said that 69 entities have been enlisted for privatisation from all sectors. The minister said that among the major entities, which are coming at the end of the cycle, include primarily the distribution companies of which the first is the Fesco. A road show was held in China in December where a good response was received including from one to two from the Chinese companies and one from Turkish company and the rest from Pakistani business community. Fesco is the first to be privatised, he added.
The minister further said that some of the issues the country is facing are in the energy sector and therefore one of the fundamental thing is to solve the energy problem through the privatisation of distribution companies. Right now there are nine distribution companies including Fesco, Iesco, Lesco, and Sesco. There are immense investment opportunities. There are few generation companies for sale in the next six months or so, he said. We will be welcoming Chinese interest. Comparing the common way of investment; privatisation is the fastest way of investment, the minister added.
Secretary Board of Investment Syed Iftikhar Hussain Babar said the government has announced many incentives for the investors. Currently, investors are free to take back their capital and dividend without any hindrances from any agency. He said the investors can import machinery at the lowest duty ranging from 0-5 percent while special incentives have been given in the power sector, adding that the government issues sovereign guarantee in the power sector to resolve the power crisis at the earliest.
Babar said that currently investors are thinking about security problems and energy crisis in the country, however Pakistan is fighting the war against terrorism for sake of the entire region, world and itself where 75,000 sacrifices have been rendered. This war will be fought till the logical end, said the secretary, adding investors should not be concerned in this regard. About the energy problems, he said that it is the top most priority of the government to overcome this challenge and some successes have already been achieved as load-shedding for the domestic consumers reduced by 38 percent and industry by 95 percent.
He said the China Pakistan Economic Corridor (CPEC) would benefit both countries. For Pakistan it would develop infrastructure, resolve energy issues besides creating jobs opportunities while for China it would reduce time, energy and time by 1/4. Secretary Commerce Muhammad Shehzad Arbab said that such conferences will result in establishing long-term investment and trading partnership between the two countries. The ministry intends to hold such business friendship conferences in future to strengthen the economic relations and investors' confidence, he added.