The government has decided to sell state-owned enterprises to foreign countries through negotiated deals instead of conducting transparent bidding.
The government has also ruled out the possibility of handing over management control of power distribution companies to the private sector.
The decisions taken by the Cabinet Committee on Privatisation (CCOP) mark a departure from the privatisation path laid in an Act of parliament, which was aimed at ensuring maximum gains for the state and avoiding discretion in such sensitive matters.
Finance Minister Miftah Ismail chaired the first meeting of the CCOP that was attended by the key cabinet ministers.
An official statement issued by the finance ministry stated that the CCOP deliberated the modalities for the negotiated government-to-government (G2G) commercial transactions and decided that it was not the domain of the Privatisation Commission.
The CCOP directed the Ministry of Finance to formulate the proposal for structured transactions in coordination with the relevant ministries for the consideration of the cabinet, according to the finance ministry.
Miftah Ismail had directed the Privatisation Commission to initiate the process for a new legal framework for the negotiated government-to-government transactions.
It was decided that the finance ministry would prepare a new legal framework for the approval of the federal cabinet that would then decide and allow for either the strategic sale or giving the stake of government companies listed at the stock market to the foreign government under a negotiated deal.
The route has been adopted for fast-track sale of the government entities. But during the PTI regime, Saudi Arabia had offered to buy two multibillion-dollar LNG power plants under a government-to-government deal. The previous government turned down the offer, terming it against the Privatisation Ordinance of 2000.
The Privatisation Commission had proposed the CCOP that a competitive route should be adopted for the sale of the listed government entities to the institutional investors and the foreign governments as per the prevailing laws and regulations.
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