ISLAMABAD — The federal government has accelerated the privatization process of Hyderabad Electric Supply Company (Hesco) and Sukkur Electric Power Company (SEPCO) following pressure from the International Monetary Fund (IMF) to ensure timely completion, sources said.
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Authorities have directed financial advisers appointed for both power distribution companies to meet their targets within the stipulated timeline. The advisers, hired in November 2025, are responsible for conducting due diligence, market sounding, and investor outreach as part of the privatization process.
Under the framework, the advisers are tasked with assisting the government in structuring, marketing, and executing a transparent and competitive bidding process in line with privatization rules. Sources said that inspections of both companies have been completed and multiple phases of due diligence are already underway. The advisers have now been instructed to finalize their reports.
The move comes amid mounting financial losses and operational inefficiencies in the power distribution sector. According to officials, Sepco is facing transmission losses of around 35%, while its cumulative financial losses increased by Rs30 billion by the end of 2024. Meanwhile, losses at Hesco have surged to approximately Rs488 billion over the same period, reflecting deep-rooted structural challenges.
The IMF has emphasized the urgent need for rehabilitation and privatization of these state-owned enterprises to improve efficiency and reduce the fiscal burden on the government.
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Officials say the privatization drive is part of broader reforms aimed at stabilizing Pakistan’s energy sector, attracting private investment, and addressing chronic issues such as power theft, losses, and poor governance.
The government is expected to move ahead with the next phase once advisory reports are finalized, paving the way for potential investor interest in the struggling utilities.