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Feb 12 - 18, 2001

PC to invite EoIs for PTCL

The Privatization Commission (PC) is inviting Expression of Interests (EoIs) from the interested parties in the last week of this month to privatize Pakistan Telecommunication Company Limited (PTCL) by June next, positively.

Sources in the Cabinet Committee on Privatization (CCOP) said on Monday that the officials of the PC were told that by June 2001, the majority shares of the PTCL should be disinvested along with the transfer of management to new buyers.

The bidding process for the PTCL transaction will be completed during March, April and May. "So that every thing should be in place to handover the PTCL to a new buyer in June this year," a source said.

A number of interested parties from Saudi Arabia, Egypt, Australia and Lebanon have expressed their keen interest to take part in the privatization of the PTCL.

Sources said some more foreign buyers have contacted the financial advisor for the PTCL, Goldman Sachs to purchase majority shares of the company. The representatives of Goldman Sachs are believed to have completed due diligence so that nothing went wrong at the eleventh hour of the privatization of the PTCL as had been the case in some of the deals previously.

Sources said Chief Executive Gen. Pervez Musharraf has also called for the early privatization of the PTCL.

Officials concerned concede that the PTCL deal will fetch maximum $1 billion and that it could have brought $3-4 billion, if privatized few years ago. Also the new buyers were not interested to accept over 60,000 employees of the company and were reportedly seeking considerable cutting down of the staff. Also the officials of the Privatization Commission have finalized all necessary arrangements to disinvest Liquefied Petroleum Gas (LPG) business of the Sui Northern Gas Pipeline (SNGPL) and Saudi Pak Fertilizer Company, within this month.

PSM will return Rs11.3bn to five banks

Pakistan Steel Mills (PMS) has agreed to return Rs11.35 billion which it owed to five commercial banks at a fluctuating rate of interest. Earlier, it was agreed that the PS will pay off its loans at 11 per cent fixed interest rate or the treasury bills rates, which ever was low.

Chairman Pakistan Steel Mills, Col (retd) Mohammad Afzal Khan held a detailed meeting with secretary-general finance Moeen Afzal and the governor of State Bank, Dr Ishrat Hussain, on Wednesday and was asked to agree to a new formula as the previous formula was not acceptable to HBL, NBL, UBL, ABL and MCB which lent Rs11.35 billion to the PS.

"This was our very long outstanding issue with five banks and this had been resolved as we agreed to pay back the loan at a fluctuating rate of interest rather than fixed 11 per cent or treasury bills rates, which ever was low", he said.

Commerce demands dues before merger

The commerce ministry has asked the Economic Coordination Committee (ECC) to advise the federal government to pay it Rs100.77 million outstanding against the agriculture ministry on account of demurrage charges, before the merger of Cotton Export Corporation (CEC) and Rice Export Corporation (RECP) into the Trading Corporation of Pakistan (TCP).

The commerce ministry in a summary submitted to the ECC has pointed out that the immediate payment of this outstanding amount was needed on emergency basis to clear the financial liabilities and debt of these commercial corporations.

The ministry has further pointed out that it has decided to seek the ECC intervention in its attempt to get the payment from the Minfal as it has left with no option after the concerned ministry's refusal to pay the dues.

Railways plan to increase fares

The railway authorities are planning to increase fares of air-conditioned and first class railway travel to offset the financial impact of the recent increase in central excise duty.

This was stated by federal communications and railways minister, Lt-Gen Javed Ashraf Qazi (retired) while talking to reporters at Pakistan Railways Headquarters on Tuesday.

"Increase in railway fares will be inevitable even if the POL prices are revised downwards in the next quarterly adjustment," he said. In order to save the poor from the financial crunch of the new increase, it is proposed that only air-conditioned and upper class railway passengers will be made to bear the additional burden while the fare structure for the economy class passengers will remain at the existing level, he said.

Saudis keen on joint ventures

Saudi investors and leading business magnates have shown interest in setting up cooperative ventures and investments in several industrial sectors in Pakistan.

These includes cement, chemical fertilizers, industrial fibre, paper products, chemicals and petro chemicals, electronics, agro industries, ship building, petroleum and gas sectors.

Hubco shows profit

Board of Directors of Hub Power Company (Hubco) on Wednesday announced net profit amounting to Rs4.325 billion for the July-December 2000 period, which reflected 48 per cent improvement over Rs2.916 billion, earned in the corresponding period of the previous year.

Cut in expenses

The chief executive, Gen Pervez Musharraf, has approved 25 per cent cut in the rental expenses of Pakistan missions abroad besides bringing down the number of officials in these missions to 1404. The education subsidy has also been withdrawn for school going children of diplomats serving in additional eight missions to save unnecessary costs. The government is also reviewing all the properties abroad to be sold.