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PIA, PSM needs attention

Salahuddin Haider

The writer is a senior journalist.

Pakistan International Airline and Pakistan Steel Mills, being vital national assets, now need urgent and focused attention. While production minister Hammad Azhar recently stated that Since the PSM had become a liability on the exchequer, it has to be privatized or run on a private-public partnership basis. Likewise, PIA is a national flag carrier and was the country’s ambassador round the world had enjoyed an envious reputation at one time but is now in a financial mess. With some focus, it can regain its prestigious position.

While Steel Mill, according to the minister, after suffering heavy losses for four consecutive years, was finally was closed in 2015 as a worthless organization. PIA’s downfall started in the late 90s when then chairman Shahid Khaqan Abbasi, under the golden handshake scheme, got rid of a huge number of trained officers, technicians, and lower-grade employees. Those were the people who not only ran PIA but took it to pristine heights because of their expertise, sincerity, commitment and loyalty. They were all thrown out for no rhyme or reason. While a small number of them were absorbed in Shaheen Airline or few foreign airlines, the rest were lost in the wilderness.

As president and martial law administrator, General Zia-ul-Haq during a visit to PIA headquarters advised its then chairman Air Marshal Nur Khan to relieve the institution of the burden of a substantial number of employees. I was a PIA reporter and close to Nur Khan and overheard the conversation. Nur Khan’s reply to General Zia’s command was simple and straightforward. “Why do you wish to earn a bad name and throw people out of the job? The airline will earn money for you also”. His defence, indeed was logical, for he believed that an organization, flourishing and vibrant, must keep expanding. The philosophy of retreat would ultimately lead to disaster, recovery from where would be well nigh impossible.

His words proved prophetic, for when Abbasi started reversing the time-honoured motto, there came a slump, which kept going down and down with the passage of time. It was the beginning of a disaster. He relied heavily on bank loans to pay for the forced retirement of the employees, shut down its principal stations like Switzerland, Denmark, Holland, Singapore, Jakarta etc,  Naturally an airline, counted among the best in the world, fell prey to the machinations, wittingly or unwittingly.

The repayment of bank debts became a liability, and today the airline has shrunk to a regional airline, serving few chosen stations, rather than being a global network.

It is now heavily under debt, its fleet comprising 37 aircraft, ATRs. Its present chief Air Marshal Arshad Malik is doing a yeomen service trying to regain its lost prestige, but the task is onerous, and now that the European Union has refused to lift the ban on airline’s services to its member states, the task looks doubly daunting.

As for the Steel Mill, the PPP government shoved its workers as a populist measure without realizing that corporate organizations had to run on established rules of economy. There has to be a balance between wages and salaries, perks and privileges. In 2008, PSM was in profit of Rs 800 crore. It was commissioned in mid-70s by then President Z.A. Bhutto, and produced steel, billets, and a number of other items for local industries, besides serving the armed forces’ requirement of building tanks, aircraft, and sea-going vessels for Pakistan Navy. Its benefit were enormous but its decline started because of political patronage, its workers soared to 27000, and 2600 low-grade workers were promoted illogically to officers grade.

During Pervez Musharraf era, retired Col Afzal took over its stewardship and the mill showed a profit at the rate of Rs 200 crore a day. Between 2012 and 2014, after it landed in a financial mess, it was finally shut off in 2015. India after the Nefa war with China opted for a network of steel mills and today it has 21 such institutions. India can also boast raw material for the mills but Pakistan has to import iron ore from distant Australia, spending massive amounts on shipment, freight insurance, etc.

According to Hammad Azhar, PSM is spread over 11,000 acres of land, its total land area is roughly over 9000 acres. In 2006, then Prime Minister Shaukat Aziz along with some eminent businessmen bought it for Rs 21 billion rupees. The Supreme Court reversed that deal because the price was far less than the land price itself. Pakistan Steel is now shut off. Whether the present government succeeds in reviving its efficacy remains to be seen.