PPPs, privatization key to Pakistan’s future economic growth

September 03, 2026 (MLN): Public-private partnerships (PPPs) and privatization are essential to meeting Pakistan’s future economic and infrastructure needs, Adviser to the Prime Minister on Privatization and Chairman Privatization Commission Muhammad Ali said on Friday.

Speaking at the “Mobilizing Private Capital: National Strategic Dialogue on PPPs and Privatization,” organized by the Asian Development Bank (ADB), Muhammad Ali emphasized the need for large-scale investment, stronger management practices, skilled human resources and innovation.

He noted that Pakistan’s population is projected to increase from around 230 million currently to approximately 390 million by 2050, with nearly 190 million people expected to reside in urban areas.

This is expected to increase the country’s urban infrastructure requirements by roughly 100%, according to APP.

He said Pakistan would require additional hospitals, schools, energy and water infrastructure, railways, airports and ports to meet future demand.

According to Muhammad Ali, the government alone would not be able to finance these requirements, particularly given the country’s savings rate of around 14%, compared with 32% in Vietnam and 40% in China.

He said privatization was also important from a management perspective, arguing that companies established to generate earnings should not continue relying on public funds and should instead be operated by the private sector.

The private sector can provide capital, management expertise, innovation and improved services while introducing systems aimed at reducing revenue leakages and enhancing operational performance, he added.

Muhammad Ali pointed to Pakistan’s experience with PPPs, noting that around 154 projects worth approximately $36 billion have reached financial close since 1990.

He said Pakistan’s PPP portfolio ranks among the top 14 in the developing world according to the ADB and falls within the top 10 when assessed relative to the size of the economy.

Pakistan already has the required legal and regulatory framework for PPPs, with the Federal PPP Authority Act enacted in 2017 and all four provinces maintaining their own PPP laws and institutions, he said.

He added that the Federal PPP Authority, branded as P3A, is being consolidated under the Privatization Division to bring PPPs, asset monetization and privatization under a single platform. The move is aimed at simplifying procedures, improving investor coordination and increasing efficiency.

The current PPP pipeline consists of 38 projects valued at around $6.5 billion across roads, railways, hospitals, hospitality, aviation and industrial estates. However, Muhammad Ali stressed that the pipeline needs to expand significantly.

On the privatization programme, he said the government is currently working on 27 transactions covering power distribution companies, airports, insurance companies and banks.

Citing the privatization of Pakistan International Airlines (PIA), he said the transaction demonstrated the government’s ability and commitment to execute complex privatization deals.

Around Rs600 billion in legacy debt was transferred to the holding company, while approximately $450 million of the proceeds went into the entity for its revival, he added.

In the power sector, Muhammad Ali said the government was working on the sale of nine power distribution assets, with the objective of not only privatizing the assets but also reforming the sector, introducing a competitive supply regime and developing it along modern lines.

He further stressed the need to diversify PPP sectors and transactions and standardize legal and other documentation across the five PPP authorities to speed up project completion.

Muhammad Ali called for greater investor confidence and stronger coordination among ministries and government institutions, saying collective efforts would be required to achieve Pakistan’s infrastructure and economic growth objectives.

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