K-Electric is a good example of how privatization can actually help improve market efficiency, a webinar was told. After it was partially privatized over a decade ago, 70% of Karachi is free from load-shedding, and it has one of the lowest transmission and line losses of any power company in the country, said a news release on Wednesday.
The theme of the webinar, hosted by TV news anchor Adil Shahzeb, was Is Privatization the Panacea to Ridding the Pakistan Economy of its deadweight loss. Former energy minister Khurram Dastgir Khan, former chairman Board of Investment Haroon Sharif and researcher and intelligence analyst Aamir Mughal were panelists. Khurram Dastgir touched on the ongoing dispute of the K-Electric ownership. He said the government ownership still remains the same.
Talking about the ownership of the remaining shares, he said this issue remains uncertain and ownership will be decided based on support from the government. Khurram Dastgir said the companies in the loss were a burden on the economy and that they were tolerated because they employed tens of thousands of people. However, he said, privatization is not the solution to every problem. Replying to a question raised by the host, Khurram Dastgir said Shanghai Electric had shown interest in buying it in the past but that was not the case anymore.
He said if a corporation was to be privatized then it was the responsibility of the government to ensure that this doesn’t lead to a monopoly in the private sector. Host Adil Shahzeb said the question to ask was whether privatization is the way forward and whether it can benefit the economy since many government-owned organizations were losing billions every year.
K-Electric was one example of how an entity performed better after it was privatized. Haroon Sharif said the more fundamental question that needed to be asked was whether the government should even run commercial entities.
Khurram Dastgir said if a corporation was to be privatized then it was the responsibility of the government to ensure that this doesn’t lead to a monopoly in the private sector. He said the need was the utilization of competent individuals to run these companies and that this couldn’t be provided just by the government
Aamir Mughal talked about the need for public interest in these entities. He said there is a need to find a way in which the companies are not completely privatized but rather we find a middle ground.
