ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet was informed that risks associated with the privatisation of the Heavy Electrical Complex (HEC) can be addressed through the transfer of its land to the HMC and the HMC-3 in accordance with the possession.
Sources said that the meeting of the ECC was put up a summary by the Strategic Division for the transfer of 64 acres of land of HEC and 195 acres of land of State Engineering Corporation (SEC) to the Heavy Mechanical Complex (HMC) and HMC-3, which was approved after deliberations.
The meeting was informed that the land is in possession of the HMC and the HMC-3, however, as per the revenue record it is in the name of the HEC and the SEC. The meeting was informed that the privatisation of the HEC is being pursued by the Privatisation Commission (PC) with bidders.
The legal advisor of the Financial Advisor Consortium to the PC has expressed concern on processing the HEC privatisation without transferring land which is still in name of the HEC. Risks associated with the privatisation of the HEC can be addressed through the transfer of land to the HMC and the HMC-3 as per its possession, the summary added.
HEC transaction: PC Board concerned at delay
The meeting was further informed that the land in question is of strategic significance being located in precincts of strategic installations (HMC and HMC-3).
The meeting of the ECC was requested to approve; (a) mutation of 159 acres land at village Usman Khattar from State Engineering Corporation and the HEC in the name of HMC; (b) mutation of 100 acres land at village Usman Khattar from State Engineering Corporation and HEC in the name of HMC-3; (c) transfer of land being between two SOEs will be on nominal price to be borne by SPD; (d) mutation fee of all land to be transferred in the name of HMC and HMC-3 will be borne by SPD.
The Ministry of Industries has also requested to the ECC that the proposal for payment of the outstanding amount to SEC by HMC and PMTF may also be made part of the proposal and towards this end, SPD assures that payment of Rs338 million from HMC to SEC Management Pension Fund will be made within six months. While, the liability payment of Rs142 million from PMTF to SEC Management Pension Fund will be made forthwith.
In addition, the ECC was requested that for balance payment on account of the dividend loan from the HMC to SEC, the principal amount of Rs915,000 will be paid forthwith by HMC. However, interest accrued on this loan Rs17.882 million till 30 June 2021 and thereafter may be condoned by the ECC.
While giving background of the land, it was informed that 316 acres and five marlas land was acquired by West Pakistan Industrial Development Corporation (VVPIDC) in early 90s for the establishment of the Heavy Electrical Complex in Taxila. However, the HEC was established in Hatter Industrial Estate and the land remained unutilised.
Out of 316 acres, 157 acres land at Taxila was transferred to several departments including 100 acres to HMC-3, which is an entity of SPD.
The meeting was further informed that meanwhile, in May 2007, a summary for restructuring of the HMC was initiated by the Ministry of Industries and Production (MOI&P) for the approval of the prime minister. The summary proposed the provision of additional resources to the HMC for up-gradation that included the transfer of 159 acres of land from SEC to HMC. The summary was approved by the then premier with remarks that all legal aspects regarding the transfer of HEC and SEC assets to HMC be taken care of before submission of the summary to the ECC.
The meeting was told that HMC was transferred to the SPD in June 2016 but the land is yet to be transferred and before the transfer of land to SPD, SEC got the land mutated in its name in 2015, which is under litigation between HMC and SEC.
The meeting was informed that 159 acres land is in possession of the HMC and is reflected as an asset in its book of accounts since December 2012, whereas, the HMC was transferred to Strategic Plans Division (SPD) with all assets and liabilities.
The meeting was informed that 159 acres land for transfer from SEC and HEC to HMC included 113 acres SEC land and 46 acres HEC land in village Usman Khattar, Hatter Road, Taxila and in village Kollan, Hatter Road, Taxila and out of 100 acres land is, 82 acres of SEC at village Kolian, Hattar Road, Taxila and 18 acres of HEC at village Kolian, Hattar Road, Taxila.
Copyright Business Recorder, 2022
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