Liberalization of Pakistan's National Rail Transport System - Establishing a Competitive Regulatory Framework for Long Term Sustainable Growth

62 Pages Posted: 14 Feb 2013

See all articles by Syed Umair Javed

Syed Umair Javed

Competition Commission of Pakistan

Date Written: August 2012

Abstract

The dissertation attempts to see whether liberalizing Pakistan’s national rail transport system will enable the latter to grow sustainably. First an assessment of existing literature on the subject was conducted. Then Pakistan’s national rail transport system is studied in a multi-facet context. Finally a case for liberalization is made for the railway sector in Pakistan.

Three major sources have been used as references. One, academic books and articles. Two, official reports and documents of the World Bank and Government of Pakistan. And three, a structured interview of the Chairman, Railway Board was conducted.

The literature review conducted suggests two things. One, liberalization reforms are usually accompanied by regulatory, competition and privatization reforms and have been used to convert state sanctioned network monopolies, including railways,fulfilling universal service obligations into commercially competitive entities. Two, liberalization reforms have shown that unrealistic expectations, out of context implementation, and lack of suitable frameworks can cause below par results.

Pakistan’s railway sector was born out of colonial need in the nineteenth century and continued to serve social and strategic aims after independence. This social service aspect, coupled with direct control of the government, has caused consistent decline of the sector over the past many decades.

Previous attempts to reform the railways have failed due to unrealistic targets and lack of preparation. It is suggested that liberalization may be introduced over time with prior institutional reforms such as unbundling and incorporation, and with a regulatory framework to induce and protect competition.

Keywords: Pakistan Railways, Liberalization, Competitive Regulatory Framework, Competition, Network Industry

JEL Classification: L51, L43, L92, L98

Suggested Citation

Javed, Syed Umair, Liberalization of Pakistan's National Rail Transport System - Establishing a Competitive Regulatory Framework for Long Term Sustainable Growth (August 2012). Available at SSRN: https://ssrn.com/abstract=2216380 or http://dx.doi.org/10.2139/ssrn.2216380

Syed Umair Javed (Contact Author)

Competition Commission of Pakistan ( email )

Floor 7 - 9
75-B Jinnah Avenue
Islamabad, 44000
Pakistan

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