Define Privatization in Economic Terms
Privatization in Economic
In Pakistan the term privatizat on became popular in1977 when the government headed by Gen. Zia-ul-Haq decided to hand over the nationalized industrial u its to private sector in order to encourage private sector. The private investors were not interest in making investment in Pakistan due to fear of nationalization.
Benazir Bhutto come in to power in 1988. She continued the privatization policy of the previous government and gave confidence to private sector by giving them some incentives. Nawaz sharif came into power in 1990. He is an industrialist and therefore the accelerated the privatization process. It is said that the pace of privatization of Nawaz government was even faster then the privatization of U.K
Pervez Musharraf and Shaukat Aziz also privatized some public sector like Pak Arab Fertilizer and PTCL was also privatized. The privatization of Pak steel mill was challenged in Supreme Court. As a result, court stopped privatizing Steel Mill. That is why Chief Justice Iftikhar Ahmed Ch. was punished by then President Pervaiz Musharraf for his intervention in their black act. Privatization of banks
1. MCB and ABL were handed over to private sector through privatization commission to Mansha Group and allied Management Group respectively.
2. HBL was privatized in 2004
3. UBL shares were offered to private sector in 2005
4. Some percentage of shares of National bank of Pakistan is also sold to private person.
5. IDBP, ZTBL, SME bank are also planned to be privatized. Advantages of Privatization
1. Increase in productivity
2. Increase in efficiency
3. Improvement in quality
4. Healthy competition
5. Increase in exports
6. Extension of market
7. Increase in employment
8. Adoption of modern technology
9. Mobilization of resources.
10. Encouragement to private sector
11. Increase in output
12. Price stability
13. Increase in taxes
14. Acceleration of economic growth
Disadvantages of privatization
1. Increase in inflation
2. Artificial shortage
3. Increase in smuggling of food items
4. Commercial approach
5. Focus on advertisement
6. Exploitation of consumers
7. Increase in poverty
8. Class conflict
9. Increase in crime values
Note: The need for continuous self-improvement and self-education, updating the methodological support of the learning process, expansion of educational contacts at the level of students and teachers, Expanding opportunities for qualitative assessment of the activities of the departments on the part of students in view of the freedom to choose the areas of training, development of a perspective system of students’ formation of an individual educational trajectory on the basis of an individual curriculum, activation and motivation of regular independent work of students. Negative aspects of reforming the system of higher professional education within the Bologna Process are: the exclusive focus of the Bologna Declaration on the solution of purely intra-European problems and only partially on the world, Reducing the attractiveness of Russian education and demand for it because of the lack of practical orientation of educational programs in comparison with Western ones and the desire of Russian youth to get education abroad, the threat of a massive outflow of minds and capital abroad when entering a single European space in view of the high level of mobility towards the West, the problematic employment of graduates with bachelor’s degrees due to the lack of real customers and consumers on the Russian labor market, understanding of the bachelor’s and master’s degrees as a purely academic qualification, rather than professional.