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PRIVATE SECTOR IS DOING FINE!

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FARIA AMIN
BS-GPP (06) MORNING
NUML 

Private sector: Sector of the economy run by non-state entities

The private sector is the part of the economy, sometimes referred to as the citizen sector, which is owned by private groups, usually as a means of establishment for profit or non profit, rather than being owned by the government. The private sector is part of the economy.

(According to Wikipedia)


The private sector is a very diverse sector and makes up a big part of many economies. It is based on many different individuals, partnerships, and groups. The entities that form the private sector include:

  • Sole proprietorships
  • Partnerships
  • Small and mid-sized businesses
  • Large corporations and multinationals
  • Professional and trade associations
  • Trade unions

The private sector plays an important role in the economy through the following functions:

  •   Job creation through generating employment opportunities within private companies
  •    Contribution to tax revenues and capital flow through the economy
  •    Provides goods and services to both consumers and businesses
  •    Attracts investors both domestically and internationally
  •   Finances business diversification and competition between companies

 

THE PRIVATE SECTOR IN PAKISTAN – A HISTORICAL PERSPECTIVE

 

Pakistan emerged in 1947 with the historical traditions of a free and competitive private sector. From the days of the Mughal Empires to the British Raj in India, the state was seldom, if ever, a producer of goods and services. Muslim historical traditions and legislature had adequately protected property rights and fostered a spirit of free enterprise and the development of a vibrant private sector. These traditions of a primarily private sector led economy were passed on when Pakistan was created in 1947. The public sector at the time of partition consisted only of the Railways, Telephone and Telegraph Department, the Post-Offices, Karachi Port Trust, Radio Pakistan and some coal and salt mines.

 

Field Marshal Ayub Khan's government, which ruled Pakistan from 1958 until 1969, continued to favour the private sector. It was a period of unparalleled growth, with the industrial sector outpacing China and South Korea and catching up with Japan. The first expression of privatisation as a public policy instrument occurred during the Ayub Khan period, when the Pakistan Industrial Development Corporation divested some industrial enterprises, including jute, paper, and sugar mills, that it had created up and effectively run.


Since 1999, the Government’s policy of economic structural transformation based on deregulation, decentralization, economic liberalization, and privatization, has aimed to expand and enhance the role of the private sector. With the implementation of the Government in reform program on the mentioned lives, Pakistan was ranked among the top ten reforming countries in the world in 2006 although the rating slipped subsequently in 2008.


Pakistan’s privatization experience is considered as being among the most successful in South Asia. Privatization picked up in 1999 when a number of structural bottlenecks were removed.


"WHEN THE PRIVATE SECTOR DOES WELL, THERE'S REVENUE FOR PUBLIC SECTOR"


Both private sector businesses and public sector offices work together to form a fully functioning economy. At times, they can work together on common goals. For example, private sector businesses might use government assets or resources to assist with public services. Yet for most start-up entrepreneurs, the private sector is where you will operate.
The private sector in Pakistan is the major producer of goods and services in the economy, the major contributor to investment, and the largest employer.
The privatization process has catalyzed reforms for further liberalization of the economy as well as taxation reforms. The banking sector privatizations, for example, gave the impetus for tax reform where tax rates for banks were brought down in line with corporate rates from over 50% to 35%.
Privatization has been the most important component of the Government’s strategy for invigorating economic growth, attracting investment, and creating opportunities for the private sector.

 

Agriculture sector

The agriculture sector with a 22.69% contribution to GDP is almost wholly private sector owned. Most of the mining and quarrying activities are also in the private sector. Within manufacturing with a 19.1% contribution to GDP, 100% of the textile sector (which consolidates 46% of the value added in the manufacturing sector) and a significant majority of the cement, sugar, automobile and fertilizer industries are in the private sector. So is the case with the construction sector. In the services sector, the private sector owns over 77% of the commercial banking sector, a majority of the general insurance sector, a significant portion of the transport and storage sector, and almost 100% of the wholesale and retail trade. The private sector is also a major contributor to power generation and has entered into the electricity distribution sector after the privatization of KESC.


Health sector
There are certain hypotheses about the private health sector which need to be addressed and discussed within this context of utilization of services and preference of people to seek health care in private sector. Firstly, that there is no significant difference between the level of tangibles between private and public hospitals; and that the private hospitals are better in tangibles as compared to public. The latter argument definitely can be supported because of the available evidence of utilization and preference. Secondly, that there is no significant difference in the level of assurance in both private and public hospitals; or that the private hospitals provide more assurance to patients than the public hospitals. Patients look for care besides cure and that nontangible dimension of quality has been a determinant for utilizing the private sector more as compared to the government health facilities. Thirdly, that there is no significant difference in the level of responsiveness in both private and public hospitals; and that the patient perceives that private hospitals are more responsive than public hospitals. The latter argument is yet again supported by the fact that public sector facilities have been grossly underutilized and one main reason has been the lack of empathy and respect which patients expect when they are visiting for seeking treatment. Fourthly, that the government needs to pay attention to the public sector health care system only, and that private sector health care does not need attention from government. It is a fact that private sector is indeed better than health care in the public sector.

Education sector:
The private sector education will be defined as all formal institutions that are not public, and may be found, owned, managed and financed by actors other than the state.
Participation of the private sector in the educational system and its development in Pakistan has a long history. From 1947 until 1971, the private sector contribution expanded considerably through a variety of nongovernment organizations but the process of nationalization by the Peoples Government completely eliminated the private sector from education in 1972 to 1979. 

PRIVATE INSTITUTES AND COMPANIES

Allied Bank Limited

Banks

Askari bank

Banks

Air Blue

Airlines

AirSial

Airlines

Ary Digital Network

Media agency

Shifa international hospital

Hospital

Maroof internation

Hospital

Edhi Foundation

Foundation

Shaukat Khanum Cancer Hospital

Hospital

LUMS

University

Aga khan University

University

 

 




FARIA AMIN
BS-GPP (06) MORNING



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