Private Sector To Get Representation On Railways Board

ISLAMABAD: The federal government has decided to obtain Rs6.1 billion loan from a consortium of commercial banks for Pakistan Railways’ bailout package of Rs11.1 billion.

The government will pay interest on the loan.

The Cabinet Committee on Restructuring (CCOR) of Public Sector Enterprises which met here on Friday with Finance Minister Dr Hafeez Shaikh in the chair decided to give representation to the provinces, experts and professionals from private sector, on the Railways’ executive committee and board.

The restructuring of the committee and board will be completed in a month.

Railways Minister Ghulam Ahmad Bilour, Minister for Privatisation Syed Khurshid Shah, Planning Commission’s Deputy Chairman Dr Nadeem-ul-Haque and officials of railways and finance ministries attended the meeting.

The meeting was informed that Rs4 billion would be provided through re-prioritisation of Public Sector Development Programme (PSDP) of 2011-12 for improvement of tracks and rolling stock.

The meeting decided to increase the line of credit from the Pakistan State Oil (PSO) to Rs2 billion to ensure smooth supply of oil.

The meeting directed the Railways Ministry to restore in the shortest period of time all discontinued freight and passenger trains.Talking to newsmen after the meeting, Mr Bilour said the finance ministry would obtain a loan of Rs6.1 billion from commercial banks and he had been informed about the remaining Rs5 billion that his ministry should have to submit PC-1 about its projects to the planning commission.

Sources in Railways said the PC-1 was almost ready and would be submitted to the commission in a few days.

It may be mentioned that Pakistan Railways accumulated a deficit of Rs52.5 billion till the end of June this year.

Hundreds of locomotives have been grounded in Lahore, Rawalpindi and Karachi for want of spare parts.

Insufficient number of locomotives has been the principal reason for the declining performance of railways over the past two years.

Meanwhile, Railways will continue to receive Rs2 billion per month from the federal government as part of subsidy to pay salaries, pensions and for expenses on fuel.

The government is seeking two loans of $650 million from the Asian Development Bank for the railways sector investment programme.

The loans are scheduled to be approved in August 2012.