April 10, 2019: The government has decided in principle that Pakistan Steel Mills (PSM) would not be privatized and efforts would be made to make it profitable by bringing some structural reforms in the organization, official sources said.
“PSM would not be privatized rather it would be run on Public-Private Partnership (PPP) basis to make it a profit-making institution.” Sources in the Ministry of Production said on Wednesday, adding that the ministry had prepared a summary in this regard for the approval of Economic Coordination Committee (ECC) of the cabinet.
The ECC in its last meeting, after attending a detailed briefing by the PSM Revival Committee, proposing various measures to make the PSM a profitable and competitive organization, had directed the Industries and Production Division and Privatization Commission to submit formal recommendations in the form of summary, to ECC for a final decision.
“The ministry has prepared a summary, proposing that the Pakistan Steel Mills should be run on Public Private Partnership basis,” the sources said adding that it would be submitted to the ECC for formal approval before forwarding to the federal cabinet.
The sources said that soon after the approval by the federal cabinet, process would be initiated to invite private party for investment in PSM adding that the bidding for acquiring private party would be made through a transparent process.
“International competitive bidding standards” would be followed to ensure transparency in the bidding process without trimming the present workforce,” they said.
Various international parties especially from China and Russia had already shown their interest to invest in PSM.
The sources said that protecting the rights of employees would be the priority of the government to ensure that no employee would be sacked from the job from the organization. “The government would ensure that the rights of the employees of the PSM remain intact and nobody is removed from the job”, they said.
The PSM revival committee had been of the view that the institution had huge potential, but needed proper management to tap this potential adding that once reviewed and put in place, the production could go beyond 1.1 million tons per annum.
The immediate measures needed to put the mills back on working condition include replacement of blast furnace, which has totally damaged.
According to the experts committee, the PSM administration did not apply “mouth balling” mechanism to shut down the plant, which cause damage to the furnace and now needs to be replaced.
In addition, the PSM would also require repair of its furnace and other machinery for smooth functioning.
The revival of the PSM would be made in two phases. First phase will focus to restoration of all operations of plant except blast furnace to revive the capacity of 1.1 million tons per annum. In second phase capacity would be further enhanced by 3 million tons per annum.
(APP)
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