The government has decided to privatize the Pakistan Steel Mills and dismiss over 9000 employees of the loss-making entity. We are once again witnessing a repeat of how efforts to revive or sell out the enterprise have been victim to usual politicking and rhetoric.
Minister for Industries and Production Hammad Azhar made the announcement that the PSM had become a burden on the national exchequer and its debts have surged to Rs230 billion. He said the employees will be relived under a golden handshake scheme and each will receive Rs2.3 million.
The PSM has been a white elephant for several years and successive governments have been unable to revive or restructure it. The debts have been rising and it was already facing a loss of Rs176 billion when the incumbent government took over.
The mill has been closed for several years and not a single tonne of steel has been produced in the last two years. Yet, the government has to pay billions in salaries and other expenses for a loss-making entity. This has bewildered even the Supreme Court which will hear the case next week over the fate of the mill.
There are surprisingly plenty of buyers for the entity even though the core business will be sold off and not the vast lands that cost billions. The government is already facing an economic crisis that is being worsened by the coronavirus pandemic and the only option was to either shut down the mill completely or dismiss the employees.
The PSM once had over 30,000 employees but now there are around 9,000, many of whom do not even receive salaries for several months. The decision may certainly be hard but it was necessary for the large interest of the nations.
The decision has not come without its fair share of criticism. The opposition flayed the government during a Senate session for not protecting the welfare of the employees. While in opposition, Prime Minister Imran Khan was the only politician to visit a protest by PSM employees and vowed to protect their rights.
The government is being reminded of its promise as it has decided to sell off unutilised and dead assets of state-owned enterprises including the oil and gas companies. The PSM will be the largest entity to be privatized and will help reduce the economic losses that the country has been suffering.