Biman to be privatized.

[GoldenAsif]

Biman set to become public limited company
Staff Correspondent

The caretaker government has decided to turn Biman Bangladesh Airlines into a public limited company under a re-structuring plan to turn the huge loss incurring national airlines into a profitable organisation.The government's restructuring plan is likely to cut Biman's existing 6,838-strong manpower to half.

"The government is thinking about making the national airlines profitable by turning it into a public limited company. But the government will own hundred per cent share," said Communications and Civil Aviation Adviser MA Matin after a meeting yesterday.



A high-powered committee headed by the secretary of the civil aviation ministry, already recommended transforming the corporation into a public limited commercial company. The report of the committee was placed before a consultation meeting of the adviser with civil society members at the civil aviation ministry.

After the meeting Matin told the reporters that he would place the committee's recommendations at the advisory council meeting for final approval. "I shall recommend making Biman a limited company by June."

Admitting that the restructuring plan would cut the existing manpower into half, Matin said the government would formulate a guideline for releasing corrupt and additional manpower through golden handshake.

Debapriya Bhattacharya, executive director of the Centre for Policy Dialogue, and economist Abul Barakat, who were present at the meeting on behalf of the civil society members, blamed the corporation's incurring huge loss every year mainly to corruption and mismanagement.

Former secretary Abdul Muyeed Chowdhury, Deputy Governor of Bangladesh Bank Ziaul Hasan Siddiqui, Chairman of Securities and Exchange Commission Faruque Ahmed Siddiqui, President of FBCCI Mir Nasir Hossain, acting Secretary of the Ministry of Civil Aviation Sheikh Altaf Ali were also present at the consultation meeting.

Debapriya Bhattacharya suggested that the government undertake the re-structuring plan at least in two phases. In the first phase, the government should formulate the documents for turning the corporation into a public limited company and take preparation for inviting foreign direct investment (FDI) and strategic partners.

In the second phase, the financial balance sheet would be restructured and shares off loaded through initial public offering (IPO). The huge liabilities of the corporation amounting around Tk 700 crore could be also transferred into a block account for attracting FDI, Debapriya said.

He said the government should also reschedule the existing routes while continuing the commercially viable routes like Middle East and Malaysia.

He told The Daily Star that the first phase should take 3-4 months and the second phase one and a half years for implementation.

When asked about the adviser's comment that the government wanted to keep 100 per cent share at its hand even after making it a public limited company, Debapriya said, "Nothing will change if government shares are not offloaded."

Asked whether cutting the manpower would be a drastic step, Debapriya said under the restructuring plan none would be terminated and the additional manpower would be given option for retirement through a golden handshake.

Biman incurs a loss of Tk 4,000 to 5,000 crore annually only for corruption, Prof Abul Barakat, a teacher of Economics of Dhaka University told the reporters.

"If we can stop the corruption, Biman can earn an annual profit of Tk 2,000 crore," he said.

http://www.thedailystar.net/2007/04/26/d7042601044.htm

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