ISLAMABAD: Asian Development Bank has assured Pakistan that it could extend financial and technical support for the privatisation of Pakistan International Airlines (PIA) and the Pakistan Steel Mills (PSM).
Federal Privatisation Minister Ch. Daniyal Aziz during a meeting with Werner E. Liepach, ADB Director-General for Central and West Asian Department, briefed him on the progress made so far regarding the privatisation of both loss making companies.
The minister told that it is a uphill task as there are several challenges to get to the privatisation of the steel mills and PIA, but the cost to the poor citizens is in hundreds of billions if the move is not made soon. Aziz asked the critics opposing the privatisation of the two companies making tall claims about postponing to provide that cost.
The minister informed the ADB DG that the Cabinet Committee on Privatisation (CCOP) has already approved a 30-year concession transaction structure which includes a tripartite concession agreement between the government, PSMC and the investor for a period of 30 years on the basis of revenue sharing.
According to the structure, PSM’s land will remain with the government while the plant and machinery will be leased, invested and then transferred back to the state for maximum 30 years, while no asset of PSMC will be sold.