Two years ago, Indian Prime Minister Narendra Modi rewrote headlines by proclaiming, “Government has no business to do business.” Although his tall claims about revolutionising the welfare model to ensure food, clean drinking water and sanitation for all did nothing other than obstruct the pathway to his third stint in power, the resolve to form a government that supports businesses but wears an umpire’s hat itself has, indeed, helped India emerge as a force to be reckoned with.
Today, when Islamabad wishes to throw the old playbook outside the window and emphasise the “right man right job” principle, it seeks to reinvigorate the same business sentiment. After Finance Minister Muhammad Aurangzeb, Senate Chairman Yousaf Raza Gillani has taken it upon himself to run a campaign to limit the state’s function in any market to that of a regulator, allowing (even encouraging) the private sector to take the lead.
The rationale remains the same as always: a lot is going on behind closed doors that tie the government’s hands in issues that require cut-throat commercial decisions. If the chatter on the street is to be believed, Pakistan is heading towards privatisation, full-throttle. The perpetually-languishing national carrier (PIA) might find itself under the butcher’s knife as early as the first week of August.
The overwhelming losses of the power distribution companies are another hotly-debated issue wherein the fact that consumers are being forced to pay as high as Rs 1.3 trillion to these power plants, regardless of the supply, makes a compelling case for their privatisation.
While PM Shahbaz Sharif has repeatedly spelt out his determination to dust his government’s hands off these white elephants that continue to eat meagre resources, he is no magician. Simply waving the wand or uttering the magic word won’t tear through the abyss.
No matter how mind-boggling the finances, clarity is still needed on what is being privatised and how. In the case of PIA and the DISCOS (and every other state-owned enterprise), privatisation alone cannot be celebrated as the panacea for all our problems. Only increasing regulations and transparency can ensure that a well-earned breath of relief for the government does not turn into a debilitating experience for the masses. Outcomes like increased unemployment, breakdown of inter-agency coordination and the overall impact on the consumer’s purchasing power need to be a part of an informed policy change. *