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ISLAMABAD: The government announced on Friday that 15 state-owned enterprises (SOEs) accounted for 99.3 per cent of cumulative losses during the first six months of FY24, highlighting widespread inefficiencies and operational issues within the SOE sector.
In absolute terms, the cumulative losses of these SOEs were estimated at Rs405.86 billion between July 2023 and December 2023. In contrast, the losses of all other SOEs were Rs2.812bn, according to the Finance Ministry Federal State Owned Enterprises Bi-Annual report on SOEs for FY24.
However, it was further pointed out that overall SOE losses decreased by 9.72pc compared to the previous year’s losses of Rs452.686bn over the same months. Since 2014, the accumulated losses have reached a total of Rs5.9 trillion. The government has already formed an SOE committee to categorise SOEs and define their paths toward privatisation or other corporate restructuring options. The committee aims to leverage private sector participation for enhanced efficiency and reduce the footprint of SOEs on the public purse.
Finance Minister Muhammad Aurangzeb chairs the committee, but it moves slowly.
The breakdown indicates that the National Highway Authority (NHA) reported the highest loss of Rs151.3bn, followed by Quetta Electric Supply Company Ltd with Rs56.2bn and PIA with Rs51.7bn. Peshawar Electric Supply Company Ltd reported a Rs39bn loss, whereas Pakistan Railways recorded a Rs23.6bn loss during the months under review.
Further data shows that the losses of Sukkur Electric Power Company Ltd, Pakistan Steel Mills Corporation (Pvt) Ltd, and Islamabad Electric Supply Company Ltd also reported considerable losses of Rs20.9bn, Rs14.4bn, and Rs12.1bn, respectively.
The Central Power Generation Company Ltd (GENCO-II) reported a loss of Rs8.3bn, PTCL Rs7.7bn, Pakistan Post Office Rs5.5bn, and several electric supply companies like Hyderabad Electric Supply Company Ltd Rs5.2bn, Tribal Electric Supply Company Ltd Rs2.6bn followed by Sui Southern Gas Company Ltd Rs4.6bn. Utility Stores Corporation (Pvt) contributed Ltd Rs2.1bn to cumulative losses.
The government extended fiscal support totalling Rs436bn over the six months ending December 2023. This support was divided into Rs120bn in grants, Rs231bn in subsidies, and Rs85bn in loans. Notably, no equity injections were made during this period. This financial intervention accounted for over 7pc of the federal budget’s receipts on an annualised basis.
The report also quantified Discos based on line losses during the first six months of FY24. Lesco came in first with a line loss of Rs323.46bn, followed by Mecpo with Rs272.96bn, Fesco with Rs217.41bn, and Gepco with Rs159.32bn, which was drastically reduced to Rs26.88bn in the case of Tribal Electric Supply Company Ltd.
The line losses of Hesco are estimated at Rs59.78bn, followed by Iesco at Rs68.72bn, Sepco at Rs62.84bn, Peshawar Electric Power Company Ltd at Rs186.03bn and Quetta Electric Supply Company Ltd at Rs86.72bn.
The top 15 profit-making entities for the six months of July-December 2023 demonstrated strong financial performance with a profit of Rs510.20bn, while the profits of all other SOEs were Rs50.20bn. Of these, the OGDCL led with a profit of Rs123.2bn, followed by Pakistan Petroleum Ltd with Rs68.7bn, and National Power Parks Management with Rs36.2bn. Other significant contributors include Pak Arab Refinery Company with Rs35bn and Government Holdings (Pvt) Ltd with Rs32.5bn. Additional profitable entities include the National Bank of Pakistan with Rs26.6bn and the Port Qasim Authority with Rs18.4bn.
The gross revenues of the SOEs reached Rs7.011tr, reflecting a 15pc increase from the previous year’s
corresponding period. However, the SOEs contributed Rs200bn in taxes, reflecting a 14pc decrease compared to the previous six months. Non-tax revenues, which include sales taxes, royalties, and levies, amounted to Rs349bn, representing a 27pc decline. Dividends provided were Rs9bn, a significant 71pc decrease.
Published in Dawn, December 28th, 2024
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By Touqir Hussain
DAWN: 07.11.2024
HOW will the election of Donald Trump affect US-Pakistan relations? Let’s first clear up a myth. It is not true that Pakistan had good relations with the US when Trump was president. He wanted to get out of Afghanistan for which he sought former prime minister Imran Khan’s help in talking to the Taliban.
Khan was rewarded with a visit to Washington and exceptional public praise from Trump. But once the deal with the Taliban was done, Trump turned his back on Pakistan, leaving no imprint on the relationship.
Trump notices only issues of high public interest, which have political traction. The present state of US-Pakistan relations is not one of them, neither are its domestic dynamics. Trump will most likely continue with the Joe Biden policy of low-intensity engagement with Islamabad, marked neither by significant aid levels nor by sanctions, the two extremes between which the relationship oscillated for much of its history.
There was a search under Biden for a new balance in relations that best responds to the completely changed regional and geopolitical landscape, and the shifting US foreign policy that faces challenges at home and overseas. Rising powers abroad are curtailing America’s global primacy by staking a role in reformatting the global economic and strategic order.
At home, the politics and policy of issues like globalisation, China, big power relationships, alliances, and America’s ‘forever wars’ are being reshaped by Trump’s worldview, changing the way the US perceives and is perceived by the world.
Under Trump, the relationship will likely be handled by the State Department and Pentagon whose Pakistan policy has had four elements.
The first has been a derivative of US policies towards China, India and Afghanistan. The US would like to limit China’s political and economic influence in Pakistan, and it also wants Islamabad to not undermine the centrality of India to its Indo-Pacific strategy. As for Afghanistan, its stability is key to the broader regional security including that of Pakistan.
The second element has been a direct US interest in Pakistan, focused on its economic weakness, potential for political instability, and the threat of extremism and regional insurgency to internal security, from which emerges America’s ultimate concern about Pakistan’s possible radicalisation or breakdown threatening the safety of its nuclear assets.
The third factor has been counterterrorism. Here, Pakistan is seen in many different roles: partner, target or victim. Washington needs Islamabad’s cooperation to act against the transnational terrorists who endanger the US and global security. It would also like Islamabad to deal with any militant threat against India and Pakistan’s own stability. Washington is willing to help where possible.
The fourth element is the developing US-Pakistan cooperation in the economic area, principally in energy, IT and agriculture. Investment sentiment remains cautiously hopeful. And the US continues to be the top destination of Pakistan’s exports.
The sum total of the above points to the need for engagement. What might impact it, however, is Trump’s thinking on certain critical policy areas: less military involvement abroad, decreased military aid, increased pressure on allies to contribute more to their defence, a rise in trade tariffs, and possibly a harder line on China. We do not know how it would play out. Biden’s policies had already de-emphasised military aid to Pakistan. The Trump presidency should have no practical effect here. But it is too early to tell whether tariffs would hit Pakistan. Under the last Trump presidency, they affected India, despite its crucial role in the Indo-Pacific strategy which Trump will likely continue.
We should not take Trump’s offer of help to solve the Kashmir dispute, which he made the last time, seriously. The offer had nothing to do with Kashmir. It was about himself. He wanted to please Pakistan and appear to his base as a popular world leader being looked up to by other countries to solve complex disputes.
Trump’s transactional approach will always focus on what a country has to offer America before he does anything for it. Pakistan has to ensure that its ties with the US are handled through quiet diplomacy, especially if they involve issues that incite public interest in the US negatively. That would invite Trump’s retribution.
Trump’s policies are not knowledge- or institution-based but personality-focused and politics-driven. They are a one-man show. He is at the centre of his own agenda that goes with the politics of the day. To quote The Guardian, Trump will basically “free-lance” his foreign policy. So be prepared for surprises.
The writer, a former ambassador, is adjunct professor Georgetown University and Visiting Senior Research Fellow National University of Singapore.
Published in Dawn, November 7th, 2024 |
