ISLAMABAD – The Pakistan Steel Mills (PSM) should be privatized in a transparent manner if the government is failing to manage its finances, Senate standing committee on industries and production has recommended, adding that PSM was a ‘bottomless pit’ and no amount of cash can salvage it.
The recommendations came in the report of the senate standing committee on industries and production on “Financial Losses of PSM” which was presented in the Senate on Wednesday. It said PSM deliberately kept the prices low in the first few months of 2008-09 to give its favorite dealers windfall profits when-they in turn sold PSM products in the market on high prices with huge margins.
The Ex-Chairman Moeen Aftab Sheikh together with some of his top management especially, director (Commercial) was involved in blatant financial bungling. They rendered PSM bankrupt while said that the ministry of industries had only been a silent spectator. The Committee strongly recommended the start of a criminal investigation involving the entire top management, especially the ex-chairman and the ex-director commercial including the agent mafia supplying key raw material to PSM and those shipping companies who bribed these officials.
It further recommended that the entire top management of the PSM must immediately be replaced. The committee held 6 meetings under the chairmanship of Senator Muhammad Ishaq Dar since July 25, 2009 and had threadbare discussions on the financial losses incurred by Pakistan Steel Mills. The report said PSM gave a presentation on a bailout package for the Mills. The Committee desired that the minister concerned should personally intervene to ensure immediate return of money borrowed from Workers’ Welfare Fund.
It was found that stock levels of coal and iron ore were highest when imported coal prices were highest in July/Aug, 2008. In spite of a sharp decline in sales in August, September, October and November 2008, huge quantities of astronomically high priced raw material was unnecessarily imported.
The committee was informed that sale of billets to certain specific enterprises like “Al-Abbas Group” was dramatically increased even when capacity utilization of PSM was on decline in year 2008-09.
