Pakistan Steel Mills (PSM) Board of Directors (BoD) is all set to elect its new Chairman Aamir Mumtaz, an American Pakistani on September 14, 2019 (tomorrow). On September 5, 2019, Ministry of Industries and Production issued a notification of his appointment as member of PSM Board as since the removal of Engineer Memon Jabbar from chairmanship for reportedly criticizing the federal government in the Senate Standing Committee the slot of Chairman was vacant.
Aamir Mumtaz who is an operating executive and an entrepreneur, specializes in driving enterprise performance and value by delivering transformational initiatives. He is the CEO of a cleantech company, oil purification systems, Inc. (a portfolio company of Connecticut Innovations Investment Fund).
The government recently appointed Engineer Ashiq Ali Chief Executive Officer (CEO) PSM, which is closed for the last three years and according to Secretary Ministry of Industries and Production, Aamir Ashraf Khawja, Rs 1.5 billion per month is being spent on employees' salaries and other heads.
Prime Minister Imarn Khan, who is also Minister-in-charge Ministry of Industries and Production, recently directed Minister for Privatisation, Muhammad Mian Soomro and Advisor on Commerce, Textile, Industries and Production, Abdul Razak Dawood to present a workable solution to expedite the process of revival of Pakistan Steel Mills through private investment in a transparent manner.
The Minister and Advisor have already shared their views with the future Chairman of Pakistan Steel Mills in light of discussions with three or four international companies that have shown an interest in rehabilitation of PSM. PSM has not been able to pay the dues (gratuity, provident fund and leave encashment), to its retired employees, outstanding since May 2013 that resulted in protracted litigation. Around 3000 employees out of total 4,682 who retired on or before December 31, 2018 of PSM filed petitions in Sindh High Court (SHC) for the payment of their outstanding dues.
The court in its order of August 16, 2018 directed all concerned i.e. Ministry of Industries and Production and PC to resolve the issue of payment of gratuity, provident fund and leave encashment of PSM employees within 90 days from the date of order i.e. November 15, 2018. The total outstanding dues on account of gratuity, provident fund and leave encashment of the employees retired from PSM on or before December 31, 2018 including the petitioners amounted to Rs 17.135 billion out of which an amount of Rs 1.266 billion has already been paid to the heirs of deceased employees and Rs 15.869 billion remain outstanding.
Minister for Privatisation, Muhamamd Mian Somroo also met with the Advisor on Commerce, Textile, Industries and Production and Investment on September 11, 2019 and discussed different issues relating to entities falling under the administrative control of Commerce Division and Ministry of Industries and Production.
Talking to Business Recorder, Privatisation Minister said that process to rehabilitate PSM has begun in the light of directions of Prime Minister. On August 29, 2019 Abdul Razak Dawood held a meeting with foreign companies which have shown an interest in the revival of PSM on Public Private Partnership (PPP).
Ministry of Privatisation has been forced to adopt PPP mode of privatisation as it took the stance that Privatisation Ordinance, 1973 does not deal with Public Private Partnership (PPP), therefore, the Ministry is not in a position to take further action on implementation of ECC's decision regarding revival plan on PPP basis. The incumbent government has wasted one year which cost the national exchequer more than Rs 45 billion in 380 days.
PSM Stakeholders Group headed by Mumraiz Khan recently alerted Prime Minister Imran Khan over deliberate delays by vested interests in revival or sale of the country's largest industrial complex which has been bleeding for more than a decade. Comprising employees, pensioners, suppliers, dealers and contractors, the Group said it was surprised to note that even on completion of one-year tenure of the new government, the Pakistan Steel Mills was without a management structure or board of directors and the federal ministries were uncertain how to address the PSM challenge.
Talking to Business Recorder, Mumraiz Khan said that Secretary Privatisation Division had promised to respond to his letter about "PSM revival plan" in writing but has yet to do so despite passage of several weeks.
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