Pakistan Steel Mill -A Blow To Economy
Sixty three years ago the world's map underwent a great change and the Indian subcontinent was divided into two independent states: India and Pakistan. It did not take much time to change the maps nor did it affect the neighboring countries in any great way, but this division was the result of an intense and dedicated struggle by millions of people of the subcontinent.
At the time of partition, the areas comprising Pakistan received only five per cent of the subcontinent's industry. . The foundation stone of Pakistan Steel was laid by the then Prime Minister Zulfiqar Ali Bhutto on 30th September 1973. Pakistan Steel is ...view middle of the document...
The whole process of privatisation was considered as the ‘largest dacoity’ in the history of the country. Moreover the employees of the Mills raised a lot of hue and cry against the government’s decision. The reaction against the government’s unwise decision was intense; it rocked the government. The Transparency International-Pakistan concluded that the deal was not fair as it was not acceptable for some competent bidding parties. On June 23, a nine-member bench of the Supreme Court annulled the sale of the country’s largest industrial unit to a three-party consortium due to irregularities in the process of privatisation. The apex court concluded that the government decision in relation to Mills had been taken in unexplained haste, ignoring profitability aspect and assets of the Mills and directed the government to refer the matter to the Council of Common Interests within six weeks. The apex court made it clear that squandering of national assets would not be tolerated.
Economic Problems Of Mill.
Pakistan Steel Mills is facing a severe financial issue nowadays. It is operating in a tough competition atmosphere. It is facing loss of billions of rupees. It has to pay off huge bank loans and government taxes. It is, in fact, on the verge of collapse and bankruptcy and has asked government for 10-12 billion rupees bailout package to come out of crisis while Cabinet Committee on Reforms has approved a bailout package worth Rs6 billion to tackle the situation.Following are the economic problemsat the time of establishing and hereafter.
No Back up Financial Support
The country started its journey of industrialization from zero. It started at an estimated cost of Rs14.287 billion and commissioned at a cost of Rs 24.7 billion in 1985. The average production efficiency of the mill is not more than 70 to 80 percent probably because of the inferior quality of the machinery. The Pakistan Steel Mills manufactures industrial material such as steel, coke, pig iron, rolled billets, long rolled steel, hot and cold rolled coils and sheets, galvanized coils, corrugated sheets and heavy iron products. Pakistan Steel too suffered greatly and incurred financial losses.
Powerful Mafia Involved in Corruption.
The Mills has become a residence of the powerful mafia involved in corruption. The Federal Production Minister Anwar Ali Cheema wants that still mills should be privatised because of unbearable financial burden. He claims that Pakistan Steel Mills is a sick unit ‘whose losses are getting out of control’. The question is: who is responsible for the huge losses in the Mills? Is this a deliberate attempt to create an atmosphere for the privatisation of the Mills?
Absence Of CEO Of Steel Mill.
Unfortunately this Corporation has been working without a permanent and full-fledged chief executive officer for the last several months while the losses are increasing day by day. It is stated that a particular mafia is trying to make excuses to...