ISLAMABAD Pakistan's upper house of parliament on Friday rejected a bill to privatise the cash-strapped national airline, another delay for the country's stalled privatisation agenda under the terms of an IMF bailout.
Loss-making state enterprises drain about $5 billion from state coffers every year, around an eighth of the government's fiscal revenues of about four trillion rupees ($38.2 billion) last year.
The bill now goes to a joint session of parliament next week, where it is expected to pass, because Prime Minister Nawaz Sharif’s ruling party holds a majority in the combined assembly.
"Government advisers have failed to present a revival plan for Pakistan International Airlines (PIA), instead their complete focus is on privatisation," opposition Senator Saleem Mandviwalla said in a statement.
The privatisation of 68 state-owned companies, among them loss-making enterprises such as PIA, is a crucial part of the 2013 IMF bailout and was meant to put the country's finances back on track.
The government has made some progress, for instance by raising more than $1 billion from the stake of its entire stake in Habib Bank Ltd, but has struggled to find buyers for most of the companies in the face of opposition from labour unions and other political parties.
The PIA sell-off required amending a 1956 law that barred private ownership of the national airline. Instead of an amendment, the government on Dec. 5 issued a presidential decree to turn the national flag carrier into a limited company.
The move prompted bitter criticism from political opponents who accused the government of bypassing parliament by opting for a decree over an amendment that would require lawmakers to vote.
The ruling party then moved the PIA Corporation Conversion Bill 2015 in the lower house of parliament in January, where it passed.
On Friday, however, the Senate rejected the bill, with votes from the opposition Pakistan People's Party, which has a majority in the upper house.
The PPP opposes the privatisation of PIA and Pakistan Steel Mills, saying they can be restructured and revived, rather than sold off.
(Writing by Mehreen Zahra-Malik.)
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Updated Date: Mar 04, 2016 18:15 PM