Pakistan Steel Mills to receive a bailout package of Rs6 billion

Pakistan Steel Mills to receive a bailout package of Rs6 billion

Pakistan Steel Mills (PSM) is on verge of an impending shutdown and is in dire need of money injection to continue its functioning.

To ensure the Mill continue working, the Economic Coordination Committee (ECC) has approved a bailout package of Rs6 billion for PSM. The bailout package was approved on Thursday, December 1, 2011 during a meeting held by ECC.

Cabinet Committee on Restructuring (CCOR) in its meeting held on November 5 had given the green signal to inject Rs6 billion as working capital into PSM. They also provided Rs600 million grant for Pakistan Railways so that they
may pay their outstanding arrears to Wapda.

ECC also discussed certain other issues prevailing in the country during the meeting. Amongst the most debated issues were the Latif gas field, import of sugar, and Low BTU gas policy. The ECC had to put back many agendas items
including energy audit of fertiliser plants, tax immunity on import of machinery to be used in gas import projects and revised gas load management plan due to long debate on three issues mentioned earlier.

As per a senior member who attended the meeting, “ECC opposed the approval of importing 0.2 million tons of sugar at the rate of Rs63 per kg proposed by Ministry of Industries due to sugar availability at Rs52 per kg across the
country.”

According to reports submitted by Ministry of Industries, Pakistan stock of sugar is nearing its end and only 3 months (about 90 days) of sugar is available in the country. A sub group consisting of Finance, Industries and Commerce
secretaries, was formed to look into the possibility importing sugar as well as to formulate a plan for negotiations with the sugar mill owners to purchase the product below market prices.

ECC also discussed on the reports submitted by Ministry of Petroleum and Natural Resources, suggesting that 50km pipeline should be laid down from Latif field to Sawan plant where surplus capacity is available. The reports states
that if new opportunity to process raw gas from Latif field are not found then the gas network will lose additional gas availability.

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Posted by Wajahat Javed on Dec 1 2011. Filed under Business, Pakistan. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry