ISLAMABAD, June 7: The counsel for the buyers of the Pakistan Steel Mills on Wednesday submitted before the Supreme Court that any decision against the auction would lead to failure of government’s policy on privatisation and scare away foreign investors.

Advocate Khalid Anwar submitted that the mills’ privatisation was the biggest direct foreign investment in the history of Pakistan and if the apex court decided to strike it down, there would be little investment in the future. Instead, he argued, investors would go to India.

However, Justice Javed Iqbal, a member of the bench hearing the petitions against the auction, observed that the court did not want to destroy the privatisation policy; rather it intended to adjudicate a basic question whether the sale of the Pakistan Steel Mills was within the law and whether this investment was in the interest of the country.

“Not a single evidence has been provided by those opposing its sale to prove that a particular section of the law was breached in the privatisation,” Khalid Anwar said, adding that all statements being made were politically motivated.

The mills’ counsel Wasim Sajjad informed the court that the government would spend Rs15.6 billion on golden handshake scheme for employees of the steel mills if 100 per cent employees opted for the scheme.

The court is hearing petitions against the sale of 75 per cent shares of the mills for Rs21.68 billion.

Mr Sajjad further submitted that the government had decided not to hand over Rs265 million, lying with the National Accountability Bureau, to the buyers of the mills.

Advocate General Sindh Mansoor Ahmed Khan submitted provincial government’s record regarding the sale of 19,121 acres of land to the federal government for establishing the steel mills. Though the Sindh government had supported its privatisation, it had, at the same time, demanded possession of the unutilised land.

Chief Justice Iftikhar Mohammad Chaudhry referred to a previous decision of the Economic Coordination Committee to float 10 per cent shares of the mills in the stock exchange and said that if it had been done, prices of shares would have set a yardstick for the Privatisation Commission.

“People never buy shares of government institutions; rather they prefer to purchase shares of private organisations,” Khalid Anwar said, adding that the government still owned 25 per cent shares and could sell them in the share market.

Earlier, hundred per cent shares of the mills were owned by the government but it was working at 54 per cent capacity because its coke-ovens had broken down. The government, he argued, was not equipped to manage the mills in an efficient manner.

The new buyers, he pleaded, were investing heavily to enhance its capacity to three million tons from the existing 1.1 million tons. He said countries like Singapore, Thailand, Malaysia, Hong Kong and South Korea, which had been on par with Pakistan, were now far ahead. The secret of their success, Mr Anwar said, was industrialisation.

The Emirates Airlines borrowed staff from PIA and now was the biggest airline in the world, he said.

Referring to the mills’ activity report, Khalid Anwar said that figures quoted in the statement were tricky, misleading and, therefore, it was wrong to suggest that it ever attained optimum level of production.

When he repeated his argument that the media had hyped up the issue of privatisation of the mills, the CJ observed that media was more concerned about it because “they know more things than we do”. Credit must go to the media which was performing an onerous duty of bringing injustices to light, the CJ observed.

Mr Anwar admitted that mediamen were honourable people but newspapers were sold for sensational headlines.