KARACHI (APP) - The Pakistan Steel Mills (PSM) has received Expression of Interest (EoI) from 10 companies including China and Russia to boost its production from present 1.1 million tonnes per annum to 1.5 million tonnes. After appointing a consultant from international market for evaluating the expressions of interest, the process of awarding this contract to a foreign company will be completed within next three months, said Imtiaz Ahmed Khan Lodhi, the Chief Executive Officer (CEO) of the Steel Mills. In this regard, PSM management has already given a detailed presentation to Federal Ministry of Industries and Production, and the Planning Commission of Pakistan, he said in an interview to APP on Thursday. According to Pakistan Steels CEO, after starting work on the first phase of expansion, the Mill will initiate a second phase named Green Field Project to double its production capacity to 3 million tons per year. He said the Mill has succeeded in restoring the confidence of foreign suppliers of raw materials (iron ore and coal) by them import bills amounting Rs 800 million. The Steel Mills, he said, has also been approached by private firms registered in Brazil, Indonesia and others for supply of raw material. Pakistan Steel, a state run leading industry, was set up with cooperation of former Soviet Union in early 1970s near Port Qasim. Next month we will be in a no profit-no loss position. By end of June 2011, Pakistan Steel will have small net profit on its accounts, Acting Chief Executive Officer Imtiaz Ahmed Khan Lodhi said. Pakistan Steel has also paid back all its loans and utilizing its own resources to generate funds complemented with various effective budgetary and administrative measures to strengthen its liquidity position. It has made procedures/polices very transparent especially of procurement to check possible corruption. Third party certification of raw materials has also been introduced to achieve the results. With re-commissioning of its battery Coke oven-I, in February 2011, the Mills production will rise to 1.1 million tons per year. The PSM, at present, is operating at its 50 percent capacity. With further improvement in raw materials stock position, the mill will use its 60pc capacity next month and in January 2011, it is expected to touch 70pc of its total production capacity. The Coke oven-I has been repaired at the cost of Rs 1.5 billion with the help of Russian experts. From next month, PS Billet Mill is expected to produce 0.3 million tons billets per month. Pakistan Steel has been catering up to 20pc of total steel demand of the country. For increasing its share in the market, PSM has started diversification of the products. Now, it will make improved quality sheets to beat the competitors within and outside the country. PS has already an edge over other steel mills in private sector. PS could influence the local steel market as its prices work as bench mark. Pakistan Steel produces billets, hot rolled sheets and galvanized iron sheets, besides, selling its by-products, that is, coal-tar, ammonium sulphate, slag and coke. PS is the sole source of this coke for small steel units and foundries engaged in making wide range of steel products in the country, Lodhi said. The PSM management has devised new price fixation system with full transparency to ensure better profit margins. PSM management has focussed on developing and promoting indigenous sources of raw materials to cut its raw materials bill, ensure its availability and save foreign exchange for the country, he added. In local cases, PSM has to pay the bill within one week after shipment of raw material whereas in foreign suppliers cases, the advance payment is needed and the price is also high. The local procurement will also help promote domestic industry and create jobs for the local people. Main sites developed for iron ore are Dalbadin, Chaghai and Abbottabad. Abbottabad has huge deposits. If we take 35,000 tons of ore every month from here, the supply will continue at least for 35 years, he pointed out. Shahragh area of Balochistan has big stocks of standard coal. PSM can use local coal up to 15pc; mixed with the imported one. Lodhi said Pakistan Steel has some irritants to resolve with Federal Board of Revenue (FBR) to save it from re-current big losses. Mostly, private steel companies/importers abuse the facility of duty and tax remission on exports (DTRE) granted by FBR. Under this facire-exported after value-addition. But, instead of value-addition, these importers do sell their stocks in local market at comparatively low price. This creates tough situation for Pakistan Steel in selling its products when it adds 17pc sales tax for payment to the Government, he added. Similarly, he said, forged export transactions in the name of Afghanistan Transit Trade seriously harm PSM. FBR should strongly check these illegal/malpractices which also deprive national exchequer of big amounts in duties. Lodhi suggested that system of duty draw back be applied on these steel importers as well, in the interest of PSM and the government. Under this arrangement, full customs duty is paid on imports of raw materials and the same is refunded on the exports. Some engineering industries, according to him, misuse the concessionary SROs of FBR. These SROs for promotion of certain engineering units allow import of steel at zero % to 5pc duty. But, regretfully, these industries sell the commodity directly in the local market instead using it as raw material. PS pays 17pc sales tax on its raw material while ship-breakers had to pay less duty and were able to sell the steel products at lower prices which creates problem for Pakistan Steel. The Mill expects FBR to provide it a relief. He fully supported the levy of Reformed General Sales Tax (RGST), suggesting that it will stop misuse of various tax concessions/facilities by private steel mills/dealers. Pakistan Steel, being public sector organization, has recently regularized around 5,000 daily-wagers despite being hit by global economic recession. Now, it has nearly 13,000 regular employees on pay-roll.