Steel re-rolling mills have condemned the monopoly of Abbas Group over the wire-rods manufactured from the billets of Pakistan Steel Mills (PSM) and have sought the intervention of the Prime Minister Yusuf Raza Gilani to prevent the closure of more than 200 re-rolling mills in the country.
Addressing a press conference here at Peshawar Press Club (PPC) Chief Executive Officer (CEO), Frontier Foundry, Nauman Wazir said that PSM is one of Pakistan's major strategic and influential assets with respect to economy of the country. Being the only blast furnace in Pakistan it is the lifeline that feeds all the re-rolling mills of the country, as no other source is capable of producing the quality billets, which PSM manufactures.
Criticising the management of the PSM for artificially keeping the prices of steel billets low and its selling to only its cronies, he said that PSM is incurring a huge loss of Rs 21.3 million per day (Rs 7.8 billion per annum). He alleged wire-rods (SAE-1008 and SAE-1010) are exclusively being allocated to the Abbas Group of Riaz Laljee, a supporter of the PPP-led government only at Rs 51000 per ton, which is sold to re-rolling mills at Rs 61000/- per ton.
The allocations of other grades of billets have also been restricted to a very few selected consumers. The exclusive supply of billets to Abbas Group at the current low PSM billet rate is not only leading to huge loss to PSM, but also has almost shut down 80per cent of the re-rolling mills in Pakistan.
Abbas Group has manipulated to become the sole manufacturer of wire-rod since no other wire-rod is being provided with billets from PSM since the last 3 months. He said that earlier, transparency in sale of billets was visible on the web site of PSM. In the last three months due to official patronage of Abbas Group the allocation of billets is no more visible on Internet.
The option available to re-rolling mills was the import of billets and wire-rods, but the threats of imposition of regulatory duty issued by the management of the PSM are depriving this alternate. He said the policy of the management of PSM is going to render more than 0.3 million labourers unemployed in the country.
The CEO Frontier Foundry said that the management of PSM consider themselves more powerful than the federal minister of the Ministry of Industries. Federal Minister for Industries, Mian Manzoor Ahmad Wattoo during his visit to Sarhad Chamber of Commerce & Industry (SCCI) instructed immediate restoration of the allocation of billets on Internet and establishment of regional office of PSM in Peshawar. But, the management of PSM paid no heed to it.
Nauman Wazir said that in case of failure by the government in taking remedial measures into the irregularities and financial suicide of the senior management of PSM could become one of the most serious cases against the present government. He demanded of the government for making affairs of PSM transparent within a period of one-week for bringing the price of the billets and wire-rods at par with local market.
Otherwise, there will remain no other option than disclosing the name of senior official of the government who is allegedly involved in the scandal. He said that Re-rolling Mills Association in Punjab had already brought the matter into the notice of the Ministry of Industries through a letter. He also demanded of the Competitive Commission of Pakistan (CCP) to take notice of the matter. He also warned of moving superior judiciary to seek justice in this regard.