The government dropped its plan to sell two LNG-fired power plants to Qatar. As an alternative, it decided to offer 51% shares in the Roosevelt Hotel, New York, and the Pakistan International Airlines (PIA).
The government scrapped a plan to sell two LNG-fired power plants to Qatar as an alternative, the govt plans to offer 51% stakes in the Roosevelt Hotel in New York and Pakistan International Airlines (PIA).
— Economy of Pakistan (@Pakistanomy) August 16, 2022
The meeting was called to prepare for the Prime Minister’s visit to Qatar which is expected for 22nd to 23rd August. Finance Minister Miftah Ismail and former prime minister Shahid Khaqan Abbasi also attended the meeting. The decision was also taken during the same meeting.
The prime minister has also formed a committee to finalize these recommendations by the end of this week and finalize all documentation before his departure the next week.
During the discussion on the proposal of selling two LNG power plants to Qatar, some members expressed their doubts that the country may not get the best price net of the Rs104 billion debt that these power plants owe and needed to be retired or converted into long-term financing.
After deducting the liabilities, the government may receive $500 million to $600 million at most, which was politically hard to present to the public as the best price.
According to a senior government official, price discovery for the LNG facilities was not immediately possible; so, these plants may not be given to the Qatari government for the purpose of investment.
According to the sources, Pakistan has agreed to offer Qatar 10% shares in government-owned listed companies, similar to the offer made to the United Arab Emirates.
Moreover, it was decided that Pakistan should offer 51% shares in The Roosevelt Hotel, New York, and the PIA along with the management control to Qatar. But the PIA law bars selling more than 49% shares and giving management control to any other party.
It was decided that the legal process to modify the PIA law should immediately be begun to do away with the constraining clause.
To expedite the sale of these assets, the federal cabinet has already approved a bill – the Inter-Governmental Commercial Transactions Bill 2022 – that will skip all procedures for the transaction and will also eliminate regulatory inspections, including the applicability of six pertinent laws.