Pak Steel Mills losses reach over Rs170 billion

A man walks past machines at the hot strip mill department of the Pakistan Steel Mills (PSM) on the outskirts of Karachi, Pakistan February 8, 2016. To match Insight story PAKISTAN-STEEL/PRIVATISATION REUTERS/Akhtar Soomro

The Public Accounts Committee (PAC) was informed the other day that the debts and losses of the Pakistan Steel Mills (PSM) have reached over Rs170 billion and now the government has decided to privatise it.

The committee was informed that even Russia and China had refused to revive the mills, as it had incurred Rs22 billion losses so far this year.

The committee was told that the mills was getting a marginal profit from year 2000 to 2008 and from 2008 till date the losses were increasing day by day.

Syed Khursheed Shah, while chairing the meeting, said that gas supply had been disconnected and no supply was provided to the PSM. He said only Rs2 billion was being provided to the mills as subsidy which was spent on paying the salaries of employees.

The committee admitted that neither the PPP nor the present government had provided sufficient funds to the mills to make it operational, as it needed a lump sum amount to start its operations.

Syed Khursheed Shah remarked that even Russia and China were not interested in running the Pakistan Steel Mills. He observed that 20,000-acre land of the mills valuing over Rs20 billion was more precious.

The issue was raised when the officials of the Ministry of Industry and production told the committee that they had referred the case to the NAB for investigation. When the committee asked the NAB officials about what action they had taken on it so far, they said the reference had been filed with an accountability court. But when the committee asked what action was taken against those officials who were involved in the scam, the NAB officials replied that the reference was filed and it was in stage of hearing before the accountability courts.