Proposal Under Discussion to Make Pakistan Steel Mills Part of CPEC

China and Pakistan are looking a the possibility to include Pakistan Steel Mills (PSM) in China Pakistan Economic Corridor (CPEC), said a report by a local newspaper.

According to the report, the said proposal was discussed at the 9th Joint Cooperation Committee (JCC) meeting held on November 6, 2019 in Islamabad.

However, other options are also open for getting the “best deal” to revive the PSM, which is inflicting about Rs. 2 billion monthly losses to the national exchequer. The report quoting the sources said the revival of PSM was also discussed between Pakistan’s top political leadership and the Chinese top brass during recent visits. However, no final agreement was reached between the two countries.

“If both countries agree to include PSM in CPEC, it will be out of PPRA radar,” quoted the sources of the report.

The debts and losses of the PSM increased from Rs. 460 billion to Rs. 510 billion during PTI government as Rs. 120 million per day financial bleeding continued.

The PSM Board recently selected Additional Secretary, Ministry of Industries and Production, Alam Mahsud to run its affairs temporarily.

Chairman PSM Board, Aamir Mumtaz, stated that the Government of Pakistan, PSM Board, and management are determined to revive the entity. The objective of the revival is to restore the production capacity of the mills to its original maximum level of 1.1 million tons and operationalize all the associated downstream mills. In the second phase, the mills will be expanded to 3.3 million tons.

The government and the board intend to achieve the revival through a variety of possible models. These include Public-Private Partnerships (PPP) managed through the Privatisation Commission, direct investments, joint ventures or other forms of collaboration. Discussions with international interested parties on a variety of possibilities are taking place.

The PSM’s board and management are also engaged in discussions with local groups.