Pakistan Steel which is buried deep under debts and has shown no signs of recovery over the past many years is looking for further financial assistance The Board of Directors, which met here on July 16, reportedly decided to approach the cabinet to pump-in at least Rs21 billion for revamping and expansion of the project. In case the request finds favor, chances of which appear to be dim, the issue would be sent to the ECC which is scheduled to meet in Islamabad on July 19.
According to sources privy to PSM affairs: “Pakistan Steel Mills” Board of Director”s request for the government, which is facing a financial crunch, to inject Rs21 billion could at best be termed ”day-dreaming”.” Last month, the ECC approved Rs5 billion for opening of LCs through the National Bank of Pakistan, but nothing came out of this move. The bank wanted Pakistan Steel Mill to pledge property or provide a fool-proof security. The PSM was unable to do so, rendering the entire exercise futile. Sources said that presently PSM is working on 13 percentof its installed capacity, incurring about Rs1 billion losses per month.
It is highly unlikely that the cabinet or the ECC would accede to PSM”s request for more funds. Its chairman Major-General (retd) Mohd Jawaid had also been trying hard to get funds from the government ever since taking over the public sector entity but his efforts also failed. One of the main reasons for the decay and deterioration that was witnessed over the years was the inefficiency and non-professional approach of the Board of Directors which comprises men of “little experience and no knowledge” in manning the affairs of such major project.
Copyright Business Recorder, 2012