Privatization Program in Pakistan
Muhammad Waqar
2013-02-0207
Political Economy of Pakistan (POL341)
Dr. TaimurRahman
Privatization Program in Pakistan: Lack of Proper Implementation 1. Introduction
1.1 Background During last six decades, Pakistan has employed several different popular policy trends to get better economic position. Under influence of prevailing Statism in 1950s Pakistan developed industrial base and disinvested some of state enterprises. Bhutto perceived nationalization policy at the time of dominance of Statist school of thought. Statist school of thought considers it a duty of state to play active role in economy of country directly or indirectly (Kamrava). In 1980s, developing countries started getting more liberal economic policies after getting indebted due to OPEC crisis and stagflation in late 1970s. In early 1980s, International Monetary Fund (IMF) and World Bank started advising adjustment in economic policies of indebted countries which included almost all least developed countries (LDCs). In 1988,Structural Adjustment Program (SAP) brought a complete package of adjustments in economic policies of Pakistan to get hold of worsening economic position. Speedy privatization was one of the adopted policy measure under this program as liberalization and deregulation were at the core of SAP. After formation of Privatization Commission of Pakistan (PC) in 1990, Pakistan was on the road to privatize public enterprises. Privatization program was adopted to overcome fiscal deficits, to deal with inefficient public sector and to promote Laissez-Fair economy (Roepstorff and Ansari, p.8). Along with these motives, Privatization was adopted in order to retire national debts (Pakistan, Ministry of Finance, 1991) and to attract foreign direct investments (FDI). These were some of the main justifications posed by Pakistan for the reason behind privatization process. But behind the scenes policy makers throughout the world started realizing
2013-02-0207
Political Economy of Pakistan (POL341)
Dr. TaimurRahman
Privatization Program in Pakistan: Lack of Proper Implementation 1. Introduction
1.1 Background During last six decades, Pakistan has employed several different popular policy trends to get better economic position. Under influence of prevailing Statism in 1950s Pakistan developed industrial base and disinvested some of state enterprises. Bhutto perceived nationalization policy at the time of dominance of Statist school of thought. Statist school of thought considers it a duty of state to play active role in economy of country directly or indirectly (Kamrava). In 1980s, developing countries started getting more liberal economic policies after getting indebted due to OPEC crisis and stagflation in late 1970s. In early 1980s, International Monetary Fund (IMF) and World Bank started advising adjustment in economic policies of indebted countries which included almost all least developed countries (LDCs). In 1988,Structural Adjustment Program (SAP) brought a complete package of adjustments in economic policies of Pakistan to get hold of worsening economic position. Speedy privatization was one of the adopted policy measure under this program as liberalization and deregulation were at the core of SAP. After formation of Privatization Commission of Pakistan (PC) in 1990, Pakistan was on the road to privatize public enterprises. Privatization program was adopted to overcome fiscal deficits, to deal with inefficient public sector and to promote Laissez-Fair economy (Roepstorff and Ansari, p.8). Along with these motives, Privatization was adopted in order to retire national debts (Pakistan, Ministry of Finance, 1991) and to attract foreign direct investments (FDI). These were some of the main justifications posed by Pakistan for the reason behind privatization process. But behind the scenes policy makers throughout the world started realizing
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