The steel mills founded on 02 July 1973 earned profit for last time in 2007. Thereafter, the mill has been facing huge losses for a plethora of reasons. Now it is said to be a cash spilling unit for Government of Pakistan. Poor decisions by equally poor management has landed the Mill in a quagmire.

In April 2014, the government released Rs 18.5 billion for PSM and asked the ministry to turn things around by increasing capacity utilization to 60%.PSM was tasked to raise the capacity utilization to 77% by 2015 during the PML-N government. This level would be break even and the mill would be put up for sale. However, the targets weren’t achieved after another shutdown of the mill due to poor management. Although, global recession also contributed to PSM’s downfall it was mishandled like many other organisations.

However, one of the main factors was stuffing the company with more workers than it needed by the PPP government. As per the estimates, PSM’s required around 9,000 employees to be fully functional. The PPP government instead hired over 17,000 people overburdening it in the process. A gas shortfall also followed around the same time which led to the closure of several steel mills across the country. Customers also started to import steel at cheaper rates from China and other countries as PSM gave up to competition. The tussle between Sui Southern Gas Company (SSGC) and PSM further made the matters worse for the steel mill. PSM owes SSGC Rs 19 billion, however, due to nonpayment, SSGC cut off PSM’s gas supplies. Before the cutoff, the mill was working at a 33% capacity, the operations completely halted after the gas supply stopped.

During Financial Year 2008-09, PSM recorded a loss of Rs 16.9 billion. The trend continued as the total losses reached a staggering figure of Rs 118.7 billion by the end of PPP’s government’s tenure. The losses reached over Rs 200 billion when PML-N’s government ended its tenure on 31st May 2018. These losses have now swelled to rupees 220 billion. Despite numerous bail out packages it is still on ventilator. For how long we can go along with such white elephants. Like PIA, PSM was also a victim of nepotism, jobbery, and favoritism. For the of betterment of institutions, sometimes you have to make unpopular decisions. Handing over PSM & Pak Railways to China can only change the fate of these two institutions. Alternatively, writing is on the wall for all.

IFTIKHAR MIRZA,

ISLAMABAD.