June 23, 2006 was a historic day in the history of Pakistan when the Supreme Court of Pakistan with a nine-member bench, headed by Chief Justice Iftikhar Muhammad Chaudhry, declared the letter of acceptance issued to the Arif Habib consortium by the Privatisation Commission on March 31 as void and having no legal effect.
This decision of the Supreme Court was hailed throughout Pakistan. The apex court had also observed that apart from a through-away price the matter was not debated in the Council of Common Interests.
Strangely without going through the detailed judgement the Council of Common Interests reaffirmed the privatisation of Pakistan Steel which met under the chairmanship of Prime Minister Shaukat Aziz. This is something very strange that inspite of great criticism on privatisation of the Pakistan Steel a strategic asset of Pakistan, once again the privatisation of Pakistan Steel is being carried out in a great haste, thus negating the spirit of the judgement of Supreme Court and raising unnecessary suspicions on the transparency of the complete privatisation affair.
Simultaneously it is heartening to note that Chief Minister of NWFP conveyed MMA decision to oppose the privatisation of the Pakistan Steel and other profit-making units and abstained whereas the other three Chief Ministers agreed to go ahead with the privatisation of Pakistan Steel.
As anticipated the government is bent upon to go ahead with the privatisation of Pakistan Steel irrespective of the Supreme Court verdict and lot of opposition from almost all quarters of the society.
Frankly speaking the Supreme Court decision in this case should have been taken seriously to give a second thought not only on Pakistan Steel privatisation but all units which are running in profit and are considered to be the backbone of defence requirements of the country.
Be it the nation, group, individuals one tries to learn from past mistakes and correct their line of direction but unfortunately in Pakistan no such tradition has been established, as a result we continue to suffer greater damage and later on repent when it is too late.
We could have followed India on the policy of privatisation where the Prime Minister has categorically decided not to privatise any enterprise that is generating profit. We could have taken a leaf from our old friend China that continues to run state enterprises and use state companies to compete other steel competitors abroad.
Here it is pertinent to quote the statement by Luo Bingsheng, Vice Chairman of China Iron and Steel Association, that foreign investors will find it difficult to buy shares in domestic steel firms. He further added that the sector should be controlled by Chinese State owned and privately owned steelmakers instead of foreigners, as it is one of the country's most important basic industries. Don't we understand that same is true for us?
There was a need to have national policy on steel industry in Pakistan as has been done by other countries to safeguard their national interest in ensuring that such strategic assets do not go in the hands of foreigners. If the reports are true that some Indian steel tycoons have set eyes on our steel mill then all efforts should be made to ensure that this national asset is not handed over to a foreigner that too an Indian.
In my earlier article on Pakistan Steel annulment I had mentioned that in view of large-scale reconstruction after the earthquake and other development activities taking place in the country there will be tremendous increase in the demand of steel. It will be of interest for our readers to learn that iron and steel traders have imported 10,000 to 12,000 tonnes of galvanised corrugated steel sheet from neighbouring country for earthquake hit area.
The import would almost have been doubled but due to slow compensation from government. The demand is likely to increase manifold after the compensation process is geared up and monsoon season is over. This certainly calls for revision of our privatisation strategy. The only argument the government offers is that it is not the business of the government to do business, but it is also not the business of the government to offload a national asset from its burdened back at a throwaway price when the government is under debt to the tune of $36 billion.
Doubtless to say there has been massive corruption in the Pakistan Steel due to poor managers and resultant mismanagement whose selection was based not on merit but on political considerations instead of their professional competence and technical know-how to run such huge steel plant.
It was in 1998 that the idea of privatisation of Pakistan Steel Mill was aired but later on it was abandoned and it was decided to reduce the strength of employees from 20,000 to 15,000. To implement this decision voluntary retirement scheme was introduced and the strength was reduced by over 6000 employees who were given handsome package. In February 2003 President General Musharraf visited Moscow and signed an agreement with the Soviet Union for the expansion of the plant from 1.1 million tons to 1.5 million tons. But all of a sudden in December 2004 privatisation of Pakistan Steel was again discussed, which was opposed by the Board of Directors.
The government countered it by reconstituting the board and its first session was held on February 10, 2005 under the chairmanship of Prime Minister Shaukat Aziz and the fateful decision of privatisation of Pakistan Steel was taken and sold to a consortium. But the Supreme Court on a constitutional petition against its privatisation after detailed hearing reversed the decision by declaring the deal of no legal effect.
Let us have a look at the assets of the Pakistan Steel. It is spread over 19,000 acres of land, out of this 4457 acres were part of the deal. The cost of land alone was assessed at around Rs 49 billion at the rate of Rs 10 to 11 million per acre. If we include other assets it ends up to Rs 72 billion. The task to assess value was assigned to M/s City Global Market Limited that miserably failed to assess the true worth of the Steel Mill. This assessment turned into an exercise in futility.
The Privatisation Commission owes explanation to the nation as to how a unit assessed at Rs 72 billion was sold at Rs 21.58 billion. In any case startling revelations have surfaced after the publication detailed judgement of the Supreme Court that speaks for itself how open, fair and transparent had been the process. It is not understood as to what were the circumstances that forced the Privatisation Commission not to go for expansion in spite of an agreement of expansion between the President of Pakistan and the Soviet Union during his visit to Moscow in January 2003.
This nation owes its thanks and gratitude to the Chief Justice of the Supreme Court of Pakistan for taking suo motto actions on so many occasions on important issues concerning this country. The present judgement of the Supreme Court is also in line with the way the apex court is reacting on issues of national importance being mishandled by the government.
The case of Pakistan Steel is a stark reminder. The government has still not learnt lessons well and continues to set aside all pertinent suggestions by all intellectuals and professionals.
The latest statement by the Minister for Privatisation that the process of privatisation of the Steel Mill continues only goes to show highhandedness and neglect to good judgement of the present government. What example will we give to the complete world if the opposition actually executes its threat of lodging an FIR against the Prime Minister?
If the government takes satisfaction from the fact that it has called the CCI (a popular demand by all against the privatisation of Pakistan Steel) then it has only managed to undertake a required procedure.
The fulfilment of undertaking this procedure was never an issue. The real issue was that the Steel Mill was being sold at a through away price. A few patch works by the government here and there to give this deal a transparent and legal look will never fool the people who understand that this complete issue of Privatisation of Pakistan Steel Mill is being grossly mishandled. One can only hope that the President of Pakistan will ultimately take notice of such flagrant violation by the Privatisation Commission and those responsible in the government.
Let it be pointed that in our desire to fight each other (those who are in favour of privatisation of the Steel Mill and those who oppose it) we have forgotten that the Steel Mill itself continues to be neglected. The most important point of neglect is the coke oven battery which requires immediate repair.
All those working within the premises of this unit are putting their life at stake working in hazardous environment. Unless these batteries are repaired there is every likelihood that the plant may have to be shut down. Those who doubt this should listen to the hues and cries of the Chairman of Pakistan Steel Mill who continues to highlight this very important aspect at all forums.
The government should have pity over this poor nation who have given their sweat and blood for this great institution and release funds for its immediate necessary repairs, instead of making it an issue of prestige. Let sanity prevail before this issue is again taken up with the Supreme Court that will be unpleasant, both for the government and the nation. In the words of Elmer G. Letterman, "A man's greater strength develops at the point where he overcomes his greater weakness."
There was a need to have national policy on steel industry in Pakistan as has been done by other countries to safeguard their national interest in ensuring that such strategic assets do not go in the hands of foreigners. If the reports are true that some Indian steel tycoons have set eyes on our steel mill then all efforts should be made to ensure that this national asset is not handed over to a foreigner that too an Indian.
Comments
Comments are closed.