Home Latest News Government Takes Up Outsourcing of Three Major Airports

Government Takes Up Outsourcing of Three Major Airports

ECC approves public-private partnership proposal in bid to generate foreign exchange

by Staff Report

File photo of an earlier ECC meeting, courtesy PID

The government on Thursday kicked off the outsourcing of operations and land assets at three major airports through a public-private partnership in a bid to generate foreign exchange, according to the Finance Ministry.

In a statement issued after a meeting of the Economic Coordination Committee (ECC), the ministry said approval had been granted to hire the International Finance Corporation (IFC)—the World Bank Group’s private sector body—as a transaction adviser to outsource the Karachi, Lahore and Islamabad airports to the private sector for at least 25 years. Chaired by Finance Minister Ishaq Dar, the meeting decided to outsource the airports “through a competitive and transparent process to run the airports, develop appertaining land assets and enhance avenues for commercial activities and to garner full revenue potential.”

The federal cabinet had, in December, approved the outsourcing of the three airports, advising an expeditious process with the engagement of leading international financial institutions under the Public-Private Partnership Authority Act. Under the act, an international financial institution can be hired as a transaction adviser through direct contracting with the approval of the board. Reportedly, the Civil Aviation Authority had contacted several institutions but only found the IFC willing to take on the challenge for a fee of around $4 million.

During the ECC meeting, a ministerial committee informed participants that some regional countries, particularly Middle Eastern parties, had expressed interest in taking over the airports.

Also on Thursday, the ECC deferred a summary submitted by the power division to implement an agreement signed between the government and K-Electric on the pending issue of payment of duties and taxes. It, however, approved three summaries of the petroleum division for the declaration of commerciality and field development plan over Hilal and Iqbal discoveries to Mari Petroleum Company Ltd.; second two-year renewal over Kirthar exploration license block to Polish Oil and Gas Company Ltd. from Aug. 28, 2022; and extension of well testing over Ghazi-1 discovery to Mari Petroleum.

The meeting also approved around Rs. 7.3 billion in three supplementary grants under the Sustainable Development Goals Achievement Program for Khyber-Pakhtunkhwa and Sindh. Of this, Rs. 607.6 million had been granted to the Power Division schemes in Sindh; Rs. 1.7 billion for the Ministry of Housing and Works for schemes in Sindh and KP; and Rs. 5 billion for the Ministry of Housing and Works for schemes in the erstwhile tribal areas.

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