June 28, 2003	Saturday	Rabi-us-Sani 27,1424

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ISLAMABAD, June 27: Prime Minister Mir Zafarullah Khan Jamali is due to visit Pakistan Steel Mills on July 2 to review its performance and expansion programme.

Official sources told Dawn here on Friday that the prime minister will be briefed on the alleged pressure being exerted by different political and non-political groups on the mills’ management to provide jobs and other undue benefits to the people.

Since three countries have expressed their willingness to take part in the PSM expansion, Mr Jamali would be informed about the plan to invite international tenders to avoid various legal and administrative problems, the sources said.

The first phase is to see the Mills expansion from the current production capacity of 1.1 million tons to 1.5 million tons at a cost of Rs8.4 billion, of which Rs3 billion have already been spent.

The second phase of expansion will be carried out to increase the production capacity to 3 million tons, which is expected to cost Rs2 billion.

Pakistan had signed a Memorandum of Understanding (MoU) in February 2003 with Russia during President Gen Pervez Musharraf’s visit to Moscow for the expansion of the PSM.

However, up to now, Russia’s state-run company, VO Tyazh Promexport, has not decided whether it will offer a soft-term credit or work through cash credit or prefer any barter arrangement, the sources said.

China, nevertheless, has offered a $700 million credit to undertake the first phase of expansion.

The third country to have shown interest in the mills’ expansion programme is Austria, whose V.A.Tech company has sought to take up the project on a turn-key basis.

This company has completed 800 metallurgical projects in 80 countries, which account for 70 per cent of steel production in the world.

The company has written a letter to Prime Minister Jamali, calling for a comparison to be carried out of the various offers for selecting the best one.

A two-page company letter, made available to Dawn by sources in the prime minister’s secretariat, said that a high-powered techno-financial committee may be assigned the job of scrutinizing the V.A. Tech proposal, and the MoUs signed with other companies.