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BoD revamped prior to PSM sell-off




  • Ministry of Industries and Production (MoI&P) has revamped the Board of Directors (BoD) of a financially-strapped Pakistan Steel Mills (PSM) after a formal approval of Prime Minister Nawaz Sharif to prepare it for privatisation as per the commitment made with the International Monetary Fund (IMF). PSM has sunk Rs 90-100 billion in a few years time due to rampant corruption, mismanagement and political involvement by successive governments. 

    Chairman PSM Board Fazal Ullah Qureshi, Member Engineer Daro Khan Achakzai and Member Shamshad Qureshi have been removed from the Board. Shamshad Qureshi, Chairman CBA, was nominated in the FIR registered by the FIA in PSM financial scam and has also been removed from the board. Official documents available with Business Recorder show that MoI&P issued a notification on PSM Board”s reconstitution on October 8, 2013 but the Prime Minister office issued a press release on October 9, 2013 stating that Prime Minister Nawaz Sharif has approved the appointments of following individuals from the private sector as members of the Pakistan Steel Mills” Board of Directors (BoDs): (i) Secretary Industries and Production- Chairman; (ii) Secretary Privatisation-Member; (iii) Additional Secretary (Corporate Finance) Ministry of Finance- Member; (iv) Chief Executive Officer, PSM; (v) Asad Ali Khan Chartered Accountant- Member; (vi) Engineer Jabbar Memon Businessman-Member; (viii) Shah M. Saad Hussain, HRM Professional-Member; (viii) Sohail P. Ahmed, corporate sector professional-Member and (ix) Ahmad Alman Aslam, banker/corporate restructuring professional- Member. 

    The Cabinet Committee on Privatisation (CCoP) headed by Finance Minister, Ishaq Dar, recently decided to sell 26 per cent shares of PSM. When contacted, former Chairman PSM, Board, Fazal Ullah Qureshi said that this is the first time a government has appointed Secretary of Ministry as Chairman which implied that the entity was being privatised. 

    Secretary Privatisation, Amjad Ali Khan said in a recent meeting of PSM Board that “if PSM was profitable then and only then Board could take every type of decision but because the PSM is not profitable, Rs 90-100 billion has already been sunk, as we are dependent on the government to stay alive, that is why we appreciate to receive money but regret to note that proposals forwarded are still on hold”. 

    Chairman CBA, in his observation stated that the amount of Rs 2.9 billion which has been approved is an eyewash and maintained that the ECC was not doling out alms to PSM as it was the right of the people working in PSM. “Time has been gained in order to favour some blue eyed boy in the shape of privatisation or public private partnership. It is not a viable solution for the strategic asset,” he added. He threatened that as a stakeholder, CBA reserved the right to explore available legal avenues and protest in strongest possible terms. 

    ECC has approved renewal/extension of GoP guarantee for running finance facility of Rs 2 billion for PSM up to January 4, 2014. The ECC also directed that the MoI&P submit a fact sheet on the PSM giving details of income and expenditure, the losses suffered, staffing position and the perks and privileges of its employees. However, the concerned Ministry has not prepared the list so far. 

    Copyright Business Recorder, 2013

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