Losses of eight state-owned entities surges to Rs2,201billion

ISLAMABAD: The combined financial losses of eight state-owned entities have surged to a staggering Rs2,201 billion.

These entities include the Pakistan Steel Mills, the Pakistan International Airlines (PIA) and the Pakistan Railways (PR).

The loss-making state-owned entities also include the National Highway Authority (NHA), the Water and Power Development Authority (WAPDA), the Distribution Companies (DISCOs) and the Civil Aviation Authority, according to documents available with HUM News English.

Even well-known entities such as Pakistan Post and Utility Stores Corporation have found themselves in the throes of financial distress.

An investigation into the data of 2013 revealed that the collective financial losses of these institutions had been around Rs420 billion.

What contributed to this substantial increase in financial losses?

According to the documents, identifies key reasons behind their ongoing losses, which include burdensome debts, substantial salary and pensions as well as operational deficits.

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The Pakistan Steel Mills, once a symbol of industrial prowess, now reports a staggering loss of Rs700 billion, with a significant debt load of Rs410 billion.

The PIA’s fiscal health remains a cause for concern, with an annual loss surging to an alarming Rs95 billion, according to the available data.

Similarly, the Pakistan Railways faces a record-breaking loss of Rs109 billion.

The WAPDA, encompassing both electricity distribution and generation companies, grapples with a collective loss of Rs880 billion. The NHA, responsible for maintaining highways and morays, faces an annual loss exceeding Rs45 billion.

The financial turmoil and irregularities plaguing the Civil Aviation Authority have resulted in a colossal deficit amounting to Rs300 billion.

Additionally, the Pakistan Post and the Utility Stores Corporation have sustained losses amounting to Rs61 billion and Rs11 billion respectively, according to the documents.

The PIA continued to hemorrhage funds, incurring an additional loss of Rs38 billion in the fiscal year 2022.

Furthermore, the financial woes of the Pakistan Steel Mills persist, with losses reaching a staggering Rs228 billion in the financial year 2022, accompanied by a record-breaking debt of Rs410 billion.

Comparatively, in 2013, the annual loss of the Pakistan Steel Mills was Rs12 billion.

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The data also brings to light that Pakistan Railways experienced a financial loss exceeding Rs50 billion in the past fiscal year.

Electricity theft remains a significant challenge, with approximately 556,000 consumers illicitly using electricity worth Rs470 billion over the last 14 months. Notably, this issue has been detected in only 20 districts, with losses amounting to Rs110 billion in a single year.

The documents also revealed serious financial irregularities amounting to Rs200 billion within the Civil Aviation Authority.

The federal government is now actively considering privatising these loss-making entities as confirmed by officials in the privatisation commission.

The recommendations of the privatisation commission will determine whether or not these loss-making state-owned entities will be privatised.