ISLAMABAD – National Assembly’s Standing Committee on Privatisation on Thursday directed the Privatisation Commission to provide criteria for privatisation of government entities.
Meeting of the Standing Committee on Privatization was held on Thursday in Privatization Division under the chairmanship of Syed Mustafa Mahmud, MNA, for briefing on Heavy Electrical Complex (HEC) Taxila as well as comprehensive briefing on vision and further three years plan of the Ministry of Privatisation.
Additional Secretary, Ministry of Industries & Production, gave detailed briefing on HEC. He informed that HEC was established by GOP to manufacture power transformers exclusively for WAPDA/KESC then dependent on imported transformers. It is the only one in the public sector and one of two power transformer manufacturers in pakistan. It also has an un-matching elaborate set up for rehabilitation of heavy power transformers.
The Committee was further informed that in the very beginning, working capital was short provided to the company by GOP. Mostly the orders are without advance; price escalation is not allowed and payments by DISCOs against HEC supplies are delayed. Moreover, an amount of Rs. 382 million has been deducted by WAPDA/NTDC/DISCOs so far on account of LDs. Substantial amount remains stuck-up with FBR on account of Income Tax and Sales Tax Refunds – Rs. 239 million receivable on 30.06.2020. Operating/financial results of the company have fluctuating trends. The company earned profits in seven out of previous fifteen years and earned substantial profits in the year 2007 & 2008. Current down turn of the company started from February 2017, when DISCOs stopped placement of orders due to complaint by a foreign competitor on type testing of HEC power transformer at NTDC Lab Rawat.
HEC was put on active privatisation list vide CCOP decision dated August 08, 2019. CCOP vide decision dated November 16, 2020 approved sale of all (96.6%) govt owned shares. EOI has been issued by Privatization Commission on 27-12-2020 and submission date is 09.02.2021. The Committee recommended that downfall of HEC as well as reasons for not renewal of type testing license be informed to the Committee. The Committee also recommended that bidding process should be transparent in all respect. The Committee also desired to provide a criteria for privatization of government entities. The Committee also recommended for in-camera briefing on Roosevelt Hotel, USA in the next meeting.