Privatization
As Pakistan braces for upcoming bailout negotiations with the International Monetary Fund (IMF), Finance Minister Muhammad Aurangzeb emphasized the pivotal role of privatization in attaining economic stability.
Speaking at the Pre-Budget Conference 2024-25 in Lahore, Aurangzeb stressed that moving towards privatization is imperative for the country’s economic well-being.
The government, led by Prime Minister Shehbaz Sharif, has been actively pursuing the privatization of several state-owned enterprises (SOEs) to alleviate the burden on the exchequer and address the financial challenges stemming from various economic crises.
Highlighting the collaboration between the government and the private sector, Aurangzeb pointed out positive economic indicators, such as a reduced current account deficit (CAD) and lowered inflation rates, alongside record-high stock exchange levels.
Aurangzeb revealed that there is currently a substantial cash circulation of Rs8 to 10 trillion in Pakistan, underscoring the importance of addressing tax and gross domestic product (GDP) issues. He urged businessmen to voluntarily enter the tax net, assuring them of government support and facilities.
Addressing concerns about potential harassment, Aurangzeb reaffirmed the government’s commitment to facilitate taxpayers and emphasized its unwavering stance on broadening the tax base.
Meanwhile, efforts to combat tax evasion have led to measures such as blocking SIMs of non-filers and strengthening tax compliance.
Aurangzeb also lamented the failure of the track and trace system and emphasized the need for a uniform energy tariff for industries, deeming it a fair demand.
He highlighted the detrimental impact of high interest rates on industries and stressed the importance of eliminating electricity theft.
In line with the government’s push for privatization, the Cabinet Committee on Privatization (CCOP) recently identified 24 SOEs as “fit for privatization,” including entities like Pakistan International Airlines (PIA) and various power distribution companies. The focus remains on privatizing loss-making SOEs, although profitable entities are also being considered for denationalization.
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