Private sector regime: Businessmen welcome transfer of Gencos

Shift of management control is expected to save around Rs500b annually.

ISLAMABAD: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Vice President Fazal Elahi said on Tuesday that the proposal of the Water and Power Ministry to give control of some power generation companies to the private sector for a specified time would significantly reduce the per-unit cost of electricity.

“This proposal should be approved immediately while making sure that mistakes committed in the unsuccessful privatisation of Karachi Electric Supply Company (KESC) are not repeated,” he said during a discussion forum organised by the Pakistan Economy Watch (PEW).

He added that the decision would reduce the per-unit cost of electricity if contractors were allowed to downsize these organisations.

Speaking on the occasion, Saudi Pak Insurance Company Executive Mian Shahid said that the business sector fully supported the decision.

“The suggestion is very positive and reflects the wishes of the private sector, which has repeatedly claimed that it can transform inefficient public-sector organisations into profit-making entities,” he said.

He said that giving operational control of four power generation companies (Gencos) to the private sector for 10 years would be a turning point. He said that the decision would also be a test of skills for the private sector.

Shahid said that the focus of the private sector was on profit maximisation which, he added, was urgently needed in the current situation where public-sector entities lost money every year.

Islamabad Women’s Chamber of Commerce and Industry President Samina Fazil said that matters pertaining to investment, tariff adjustment and profits should be settled in front of the public to ensure transparency.

Published in The Express Tribune, August 31^st,  2011.