The World Bank has some concerns about how Pakistan is selling its government-owned businesses.

The World Bank thinks that political interference and legal issues could affect the privatization process. Pakistan’s government-owned companies make less profit compared to other South Asian countries. In 2014, these companies made a profit of 0.8 percent of the country’s total economic output (GDP), but in 2020, they lost money equal to 0.4 percent of GDP.

World Bank on Privatization

The World Bank also mentioned that Pakistan’s privatization plans have been stuck since a 2007 Supreme Court ruling. This ruling, along with decisions about Pakistan Steel Mills and Recodec, made Pakistan look like a country that doesn’t follow global trade agreements.

According to the organization, even during the PTI government’s time in power, the privatization of the Pakistan Capital Act was delayed, and they couldn’t privatize power sector institutions because of labor unions. Even after privatizing K Electric, the performance of the company was not good.

The World Bank also noted that political parties in Pakistan don’t agree on the privatization plan, and government-owned companies from other countries might face legal challenges if they try to privatize.

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