Pakistan’s federal government launched a bold initiative to privatize 24 state-owned enterprises (SOEs) in three phases, aiming to ease the financial strain on the national treasury.

Federal Minister for Privatization Abdul Aleem Khan detailed the plan in the National Assembly on August 6, 2025, outlining a roadmap to transform the country’s economic landscape by offloading loss-making entities.

The strategy, approved by the Cabinet Committee on Privatization on August 2, 2024, and ratified by the federal cabinet on August 13, 2024, targets efficiency gains and investor confidence.

First Phase

In the first phase, set to conclude within a year, the government will privatize 10 key institutions, including Pakistan International Airlines (PIA), the Roosevelt Hotel in New York, and Zarai Taraqiati Bank Limited (ZTBL).

Three electricity distribution companies (DISCOs)—Islamabad Electric Supply Company (IESCO), Faisalabad Electric Supply Company (FESCO), and Gujranwala Electric Power Company (GEPCO)—also feature in this phase, alongside First Women Bank Limited, House Building Finance Corporation, Pakistan Engineering Company, and Sindh Engineering Limited.

Khan emphasized that swift action will attract robust investment, addressing PIA’s PKR 825 billion debt and projected losses of PKR 259 billion by 2030.

Second Phase

The second phase, spanning one to three years, targets 13 entities, including Utility Stores Corporation, State Life Insurance Corporation, and four power generation companies (GENCOs): Jamshoro, Central, Northern, and Lakhra Power Generation Companies.

Six additional DISCOs, such as Lahore Electric Supply Company (LESCO), Multan, Hazara, Hyderabad, Peshawar, and Sukkur Electric Power Companies, will also transition to private hands. This phase allows time for regulatory adjustments to maximize investor appeal.

Final Phase

The final phase, set for three to five years, focuses solely on privatizing Postal Life Insurance Company, ensuring a gradual and transparent process.

Khan highlighted that the plan addresses past failures, like the 2024 PIA bidding that drew a single PKR 10 billion offer against a PKR 85 billion minimum, by refining strategies to secure better deals.

This privatization push aligns with Pakistan’s economic reform agenda, driven by a $7 billion IMF program, to reduce the burden of SOEs, which have drained billions annually, as noted by Prime Minister Shehbaz.