The government has decided to transfer all excess land (2,420 acres) of Pakistan Steel Mill (PSM) to the National Industrial Parks Development and Management Company known as NIP on 'freehold' basis at Rs 3 million per acre for developed land and Rs 1.5 million per acre for undeveloped land, well-placed sources in the Industries Ministry told Business Recorder.
The sale price of land was finalised at a meeting of Prime Minister Shaukat Aziz with Industries Minister Jahangir Khan Tareen and PM's Adviser on Finance Sulman Shah last month, but now the issue has been placed before the Economic Co-ordination Committee (ECC) of the Cabinet for endorsement, the sources added.
The ECC would take up the issue in its meeting on November 28 to be chaired by the prime minister, they said.
Sources said that NIP has been authorised to borrow the required amount of loan from commercial banks with the GoP's guarantee, adding that both PSM and NIP may jointly process and transfer land to the pending applicants immediately.
They said the Pakistan Steel has been directed to declare sale proceeds of land as dividend, jointly work with NIP to prepare a viable plan for managing the transfer of common infrastructure facilities at the industrial park for subsequent operation by NIP.
Giving the background, they said the Industries Ministry had submitted a summary to the ECC few months earlier wherein it was proposed that developed part of Downstream Industrial Estate (DIE) may be transferred at the lease rates of Rs 550 per square yard ie Rs 2.662 million per acre. In addition, the annual ground rent of Rs 2.65 per square yard with 5 percent annual escalation be magnetised and its present value may also be changed from NIP, they added.
It was also suggested that undeveloped land may be transferred to NIP at Rs 1 million per acre on the precedent of land leased by Port Qasim Authority (PQA) to the Pakistan Textile City Limited.
The ministry also proposed that NIP may sell industrial plots at the cost it bought the land plus development/maintenance charges. The payment for the land transferred to it may be made in instalments corresponding to the payments received by it from the industrial units.
It may be mentioned here that the Industries Ministry, PSM and NIP differed with each other on the valuation of developed and undeveloped land as the ministry rejected the resale price of plots, set by AKD Securities for undeveloped land.
Keeping in view the differences among public stakeholders on resale issue, the ECC constituted a committee under the chairmanship of PM's adviser, comprising representative of the Industries Ministry and the Privatisation Commission (PC). The committee placed its recommendations before the Prime Minister for final decision.
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