Federal Government Approves Restructuring of Loss-Making State-Owned Enterprises (SOEs)

Islamabad: The federal government has made a significant decision regarding the mounting losses of state-owned enterprises (SOEs) in Pakistan. The Cabinet Committee on State-Owned Enterprises (SOEs) has approved the restructuring of several of these institutions following a report highlighting an annual loss of nearly **PKR 1 trillion**.

**Restructuring and Downsizing Plans:**

According to reports, some of the most financially struggling state-owned enterprises will undergo a “right-sizing plan,” which may involve closures. However, this plan will not apply to all state-owned entities. The decision primarily targets enterprises like the **Printing Corporation, Livestock and Dairy Development, Railways, OPF, FDB, and the PCSIR**, where significant changes in the boards of governors have been approved.

This is the first time that the **Printing Corporation of Pakistan** has included **five independent directors** on its board, signaling a move towards greater accountability and transparency.

**Government’s Strategy for Loss Reduction:**

The decision was made based on an alarming report revealing that these state-run enterprises collectively face massive annual losses. The **right-sizing plan** is expected to reduce inefficiencies and prevent further financial drain. The first half of fiscal year 2024’s summary has already been reviewed in light of these decisions.

In the coming weeks, the government is expected to present more details regarding the **right-sizing plans** for additional ministries and departments. The full proposal will be submitted to Prime Minister **Shehbaz Sharif** and the Cabinet for final approval.

**Restructuring of Boards:**

The Cabinet Committee on SOEs has also approved the reconstitution of the boards of several state-run enterprises. This restructuring is intended to implement the **right-sizing plan** across various sectors effectively.

**Impact on State-Owned Enterprises:**

It is important to note that the **right-sizing plan** will not involve the complete closure of all state-owned enterprises. Only those identified as causing severe financial losses will be targeted for downsizing or closure.

The Ministry of Finance is also expected to release a detailed report soon on the financial losses of these entities, which is likely to guide future decisions regarding the fate of these SOEs.

**Conclusion:**

This move is part of the government’s broader efforts to streamline Pakistan’s state-owned sector and reduce the burden of unsustainable financial losses. If implemented effectively, the **right-sizing plan** could mark a significant step towards improving the operational efficiency of state-run enterprises while mitigating their negative financial impact.