Pakistan Railways has laid off 18 per cent of its “unnecessary staff” as part of its efforts to improve its performance and align with the reform agenda mandated by the International Monetary Fund (IMF), the Prime Minister was informed on Monday Shehbaz Sharif.
The move is a key step in implementing ambitious reforms required by the IMF as part of its $7 billion financial rescue package.
At a meeting chaired by the Prime Minister to review the performance of the railway sector, the Prime Minister directed the organization to modernize its operations. He stressed the need to attract passengers by offering competitive and improved travel services through public-private partnerships.
He also asked Pakistan Railways to hire a professional and skilled workforce, replace outdated systems with modern technology and develop a comprehensive strategy to increase regional trade, especially with countries from Central Asia.
Furthermore, the Prime Minister called on Pakistan Railways to utilize its vast land assets for commercial activities in collaboration with the private sector to generate revenue.
The Prime Minister’s Office (PMO) reported that Pakistan Railways suffered losses of Rs 10 billion during the devastating floods of 2022, when much of its infrastructure remained submerged for 35 days.
Despite this setback, the railways improved their performance in the following months and made profits equivalent to the initial cost of their freight operations, the PMO said.
The reforms aim to transform Pakistan Railways into an autonomous and efficient organization capable of playing a central role in the country’s economic development.
However, these layoffs highlight the difficult decisions taken to meet IMF conditions and improve the long-term viability of state-owned enterprises.
The IMF has long recommended improving the governance of loss-making state-owned enterprises like Pakistan Railways, which have racked up billions in losses over the years due to poor management, operational inefficiencies, heavy debts and corruption.
Privatization of public sector organizations and reduction of excessive staffing are among the crucial reforms undertaken by Pakistan to revive its ailing economy.
Pakistan’s railways, plagued by decades-old infrastructure and poor management, have been particularly hard hit. The organization faced frequent train accidents due to outdated signaling systems and tracks, further tarnishing its reputation.
