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A Chinese firm has expressed interested in the sale of Pakistan Steel Mills (PSM) as the PML-N speeds up the privatisation process on the back of International Monetary Fund reservations over the matter.
China's Baosteel Group has written a letter to the federal government expressing its interest in acquiring PSM, sources told DawnNews.
The privatisation process is likely to be completed during the ongoing financial year 2016-17, the sources said.
Baosteel Group has 19 subsidiary companies and total annual production of the company stands at 34 million tonnes.
The sources added that the IMF has expressed reservations over the slow process of privatisation of PSM, after which the government decided to complete the process on a fast-track basis by June 2017.
They said that the federal government has been trying to minimise PSM's financial constraints. They claimed that the Sindh government has so far shown no interest in acquiring PSM.
It is worth mentioning here that PSM has not been functioning due to suspension of gas supply over non-payment of outstanding bills worth Rs39billion to Sui Southern Gas Company Limited. Additionally, above 14,000 PSM employees have been deprived of their salaries for the last five months.
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Comments (48) Closed
Oct 21, 2016 05:47pm
China is basically interested in Whole Pakistan. And Pakistani people are only interested in becoming Rich by doing nothing.
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Oct 21, 2016 05:50pm
Time for making money by selling in penny's and under table flight of capital to designated accounts. They call democracy "KHATREY MAIN HEY".
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Oct 21, 2016 06:06pm
@Arshad Hussain Khan - Its the incompetent rulers who did nothing and let it ruin. It is their own family businesses that are flourishing nicely!
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Oct 21, 2016 06:14pm
China is like a good businessman will seek a good bargain..
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Oct 21, 2016 06:29pm
Make it "army"-owned institution. It is sad we are on the verge of losing all our institutions because of corruption.
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Oct 21, 2016 06:27pm
Great news. Chinese company buying the Steel Mill which had been closed due to bad management and corruption, will be saved. There should be no interference from the government as to how it will be managed, surely it will become profitable again.
Thousands of people will get jobs again but will have to perform to make it profitable.
This would be good case study for the government, how the government bureaucracy failed, but private enterprise will make it profitable again. This is good for Pakistan.
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Oct 21, 2016 06:52pm
Thanks to politicians and Ministry of Production,that lead to this day.Normally in developing nations like Pakistan there's an obsession to have steel mill like PSM,luckily we got 1, but the greedy politicians have their own personal priorities,they drain out the money,but working out best ways of corruption. And now the whole world is witnessing a " failed steel mill" for sale in Pakistan.Our neighbor India has about 50 steel mills,13 of these are mega mills.We could not manage 1 mega mill.Currently we made our PSM a big liability & mess,no one is interested to buy it, Baosteel Group China can run it successfully,due to best location & infrastructure ,Port Qasim is there,the huge revenue from Port Qasim,is perhaps the main attraction of this sale. The sale of PSM will be another feather in cap of PML(N), and will be read by future students of Pakistan how we sale our stragedic assets.
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Oct 21, 2016 06:52pm
@Jai Hindu, China is not buying but the Chinese firm has shown interest.
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Oct 21, 2016 07:20pm
Some industries are strategic resource, steel mills along with power plants are one of them, in case of blockade during a conflict, a country needs to be able to product steel and other metallic products for defense purpose. If you sell your only steel plant you are going to be at the mercy of private parties even in times of peace. Do you really want to trust a non Pakistani entity with the future of your country.
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Oct 21, 2016 07:35pm
@Writings on wall previouslymr shaukat aziz privatized the mill
but supreme court objected,you should know that steel mills are
running in loss and in britain reliance which is run by tata has closed its business as in business there are losses and gains,therefore governments jobs is not to run companies
as steel mills non privatisation gave us loss of 750billion rupees
yearly ,therefore it is better to privatise it as soon as possible to avoid this 750billion rupees loss annualy
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Oct 21, 2016 07:44pm
@Ali How many Pakistani technical persons got job in CPEC project ?Do you expect Chinese firm gives employment to local people after purchasing this steel mill?
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Oct 21, 2016 07:51pm
just a beginning...
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Oct 21, 2016 08:07pm
Sell it. Cut ur losses short!
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Oct 21, 2016 08:09pm
@Mubashir Munir I agree your points to some extent .When CPEC projects completed the power tariff for power will be Rs 17 for kwh where as the this Chines firms will get at very lower rates .For your kind information ,all steel mills in India are incurring heavy loss due to very cheap rate by Chinese steel which is less than Rs 30000 per Tonne comapre to Indian steel of Rs32000 per Tonne though Indian cost of power production is just Rs.5 per kwh.Do you think Pakistani Industries will survive in future except selling all industries to Chinese Firms ?
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Oct 21, 2016 08:14pm
Pakistan must understand that Chinese are supporting them at every thing coz they are clever people, want to boost their slowing economy, they are not brothers, so please dont sell every thing to china,
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Oct 21, 2016 08:25pm
It is better to give it China even free, for making it viable. Steel Mills is a dead elephant that is only a goldmine of its scavenging workers and their bosses.
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Oct 21, 2016 08:32pm
@Harmony-1© : The incompetent rulers are the real ironsmiths highly qualified to run any defunct steel mill to glowing profits. Look at the Jeddah Steel Mills that was getting rusted for long doing nothing. It was acquired by them for showing their worth and made it hugely profitable by the these rulers, when in exile there.
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Oct 21, 2016 08:51pm
Please sell it and get rid of the millions paid in salaries , plus Chinese will bring it back to profitability and it will add to the prosperity of Karachi and ultimately Pskistan !
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Oct 21, 2016 08:53pm
@Jai Hindu You guys curse China and at the same time looking for Chinese money in your country ! Chinese invest everywhere as in Pakistan, Bangladesh , India and Nepal too !
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Oct 21, 2016 09:11pm
@Arshad Hussain Khan Well said my friend!! I heard that even needle is made in China in Pak .. Have a very good suggestion for my friends across the border!! Stop needling and try to make your home prosperous!!
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Oct 21, 2016 09:39pm
@Ali when airlines and railways owned by Pakistan Government put loss you people suggests for Privatization and when private firms put heavy loss you people suggests to sell to Chines firms .Where Pakistan is heading?
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Oct 21, 2016 09:40pm
Our generation is an absolute embarrassment to the country.
We the civilians are incapable of running any institution in the country.
Yet we whine when the faujis take over anything or have zero respect for politicians.
Do you blame them ???
Are we civilians such duds, that we are unable to manage anything, be it PIA or PSM.
Where are our Nur Khan's ???
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Oct 21, 2016 10:10pm
privatization is not a solution for functioning of institution but there leadership is liable. interference of government is liable change both and choose a honest politician.
peoples of pakistan can learn a lesson from india where almost psus was in loss but within two year almost psus are making profit ....
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Oct 21, 2016 10:44pm
If Chinese acquire PSMs there will be no union rules.
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Oct 21, 2016 10:49pm
@Harmony-1© ... ... Not exactly. The steel workers union and political backers sought higher and higher salaries until the mills became unable to compete, and eventually unable to make profits. PMS then was an exercise in futility helping to drain Pakistan's treasury. As you may recall PSMs became unable to pay their suppliers and were harming other companies as well.
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Oct 21, 2016 10:54pm
@Trust ... Don't blame corruption. Blame the union.
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Oct 21, 2016 11:04pm
@Dook .... .... That is why the government has spent hundreds of billions of rupees subsidizing PSM.
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Oct 21, 2016 11:12pm
@Mubashir Munir ... ... Some of the largest steel companies in America closed their doors years ago and their mills stand empty and silent. Electric furnaces melting scrap steel and companies manufacturing new high strength materials have replaced them. Inland, Republic, Wisconsin steel and Youngstown to name a few.
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Oct 21, 2016 11:15pm
@M.Saeed .... .... You hit the nail on the head.
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Oct 21, 2016 11:24pm
@dwarakanath .... China does not need to buy coke and iron ore from others. They have their own overabundance off iron ore and coal deposits in Manchuria. What they are seeking in Baluchistan are heavy metals for their electronics and materials industries. They control the world's supply of heavy metals.
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Oct 22, 2016 03:55am
@Arshad Hussain Khan "Getting Rich by doing nothing" I call this a deal .Its just like Saudi Arabia when they stuck oil. I fully support CPEC
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Oct 22, 2016 04:02am
@Dook "some Industries are strategic" that why we selling it to our all weather strategic friend China. In need of the hour China has always stood by us
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Oct 22, 2016 07:32am
@Ali
"Great news. Chinese company buying the Steel Mill which had been closed due to bad management and corruption, will be saved. There should be no interference from the government as to how it will be managed, surely it will become profitable again.
Thousands of people will get jobs again but will have to perform to make it profitable. This would be good case study for the government, how the government bureaucracy failed, but private enterprise will make it profitable again. This is good for Pakistan."
Let them buy first, wait for some time then and after that you comment on the same.....
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Oct 22, 2016 07:46am
Pakistan has a lot of land available, why they want to buy a mill showing huge loses instead of building a new one. If the Government think s that the buyer can run steel mill then facilitate the buyer to establish a new mill. After that PSM can be closed or sell. At least we will have a new mill with new machines
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Oct 22, 2016 08:05am
Pakistan Steel Mill was built in Mr Zulfiqar Bhutto's regime with Russia's support. The plant thereafter failed due to mal-administration .
This offer from China should be considered seriously as our indigenous source for steel and its allied products is indispensable for nation's economic growth
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Oct 22, 2016 08:10am
Why Pakistan not making it a JV with more advanced German companies as India did with the govt. undertaking steel palnts with majority stake with Indian govt.Now these are profitable plants in India.
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Oct 22, 2016 09:07am
If you sell 'it' you will also give lots of money like taxes rebates fiscal incentives mloans etc..
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Oct 22, 2016 09:38am
@Dook [[Some industries are strategic resource, steel mills along with power plants are one of them, in case of blockade during a conflict, a country needs to be able to product steel and other metallic products for defense purpose. If you sell your only steel plant you are going to be at the mercy of private parties even in times of peace. Do you really want to trust a non Pakistani entity with the future of your country.]]
You are joking, right. Steel mills has producing nothing for several months, so how can that be a strategic resource?
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Oct 22, 2016 10:40am
Privatization is not fortune for all institutions. Please for God's sake be Patriotic to Country.
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Oct 22, 2016 10:44am
This is a initial stage. China will take-over all small and big companies of Pakistan. Wait and see for another 2-3 years.
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Oct 22, 2016 11:23am
@D.K. PAMNANI, Pakistan is getting foreign investments.
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Oct 22, 2016 11:26am
There is a lot of controversy about the privatization of PSM. There are misgivings, misconceptions and mistrust. The government must know these. It is government's job to evolve a consensus and bring to light all pros and cons of this issue. All the doubts about the privatization should be removed and all the factors against running it under state control should be explained. The national interest must be the prime factor to consider. The political and personal interests must be left behind.
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Oct 22, 2016 12:25pm
There is no loss to Pakistan if Chinese buys steel mill, but Govt should ensure it gets fair price for the mill from Chinese. Privatization actually improves productivity.
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Oct 22, 2016 02:14pm
Pakistan Steel Mill is a national asset instead of selling it outrightly the interested company should be given a on lease for 25 years to operate, earn & share profit.
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Oct 22, 2016 04:59pm
What a tragedy that we even cannot run an operate a steel mill. This is sheer incompetence.
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Oct 22, 2016 06:07pm
... & thus Pakistan succeeded...a success story! All the good opportunities from china to his friend! Do not ask why he is not helping to keep that in Pakistanis hands!
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Oct 22, 2016 08:49pm
Good news, when export market facing bad time.
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Oct 24, 2016 12:37am
Please can we put our Govt. for sale as well?
Anyone interested?
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