Chinese group shows interest in PSM
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ISLAMABAD: Sinosteel Corporation, China’s second largest importer of iron ore, has expressed interest in the revamping and expansion of existing plants and operations of Pakistan Steel Mills (PSM).
In a meeting held with Minister for Industries and Production, Ghulam Murtaza Khan Jatoi here on Wednesday, a Sinosteel delegation said that it intends to expand its overseas operations and considers Pakistan the best choice being a consistent partner in international cooperation.
Mr Jatoi, while assuring all possible support, asked the Sinosteel delegation to firm up its proposals and submit to the ministry since privatisation of PSM is on government’s agenda.
Once the proposals are received, the industries and production ministry will take up the case with the Privatisation Commission so that a feasible option is charted out which could benefit Pakistan and Sinosteel Corporation, Mr Jatoi told the delegation.
Mr Jatoi advised the Chinese delegation to undertake a visit of Pakistan Steel and its facilities so that it can get a better understanding of viable options for cooperation. He further recommended joint proposals for PSM and Sinosteel cooperation.
Published in Dawn, July 30th, 2015
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Comments (43) Closed
Jul 30, 2015 10:40am
Pakistan Steel Mill can only flourish if it is handed over to a very strong & independent operator with full authority of hire & fire. The union activities should be very limited. Chinese are well suited for this job
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Jul 30, 2015 10:43am
Pakistan really needs to wake up and stop worrying about how US would react
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Jul 30, 2015 11:01am
It is an excellent development.
Pakistan Steel labor Unions should assist in the task of privatization instead of opposing it. This will allow for creation of stable working places for labor and development of the national economy.
In current world depressed economic climate the party with power to control prices of raw material (in case of Pakistan Steel iron ore and coal supplies) is the best bet for stable operations.
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Jul 30, 2015 11:17am
Excellent News for PSM and Pakistani stake holders. Atleast there are some countries who want us to be good among committee of Nations. Congrats to PSM employee too and pray for execution and success of deal
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Jul 30, 2015 11:20am
Cooperation for financial investment and technical expertise to increase production, sales and distribution should be explored. But no need to sell the PSM. Selling important national assets like steel mills is not the answer, and sale of steel mills would be a big LOSS for people of Pakistan. Here is a test of leadership to save and grow the steel mill without selling it to foreigners.
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Jul 30, 2015 12:06pm
Steel mill is our asset and is not for sale. Let China build one for themselves.
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Jul 30, 2015 12:09pm
Chinese will pay peanuts for our steel mill. Commission to Govt. employees will be taken from tax money. I say, thanks our mill is not for sale.
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Jul 30, 2015 01:11pm
Give the Steel Mill to Chinese. At least many jobs will be secured.
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Jul 30, 2015 01:32pm
Pakistan has good potential but make sure management and hiring should be under investor control
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Jul 30, 2015 01:39pm
Seems a very good opportunity for Govt to flourish this crippling institute rather to give continuous breath through bail out packages.
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Jul 30, 2015 01:44pm
The Chinese also showed willingness to invest 50 billion for hydro-power but non-interest on our side meant nothing happened. The same would happen here. Jatoi has asked Sinosteel to do more and 'firm up' their proposal which is polite way of saying get lost.
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Jul 30, 2015 01:45pm
Didn't knowPak had a steel industry !!
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Jul 30, 2015 02:05pm
slowly chinese will acquire all the pakistans assets like steel mills,
electricty boards,banks,railways etc in the guise of developmet.politicians will sell
it for cheap price to them for thier kickbacks.pakistanis will
work day and night for the development of china being in false illusion that they work for pakistan.all the small scale pakistani manufacturing industries have to shut shop because of massive influx of low quality chinese goods to pak.
this is the ploy of chinese wherever they go and invest in business.slowly without even
knowing what is going on they will usurp that country with huge finanacial debts with high interests and
virtually take over that country.pakistanis be carefull about chinese.dont sign any business
deals without verifying and analysing the documents when it comes to chinese.
thanks
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Jul 30, 2015 02:16pm
@Abdulla Hussain - That usually happens through privatisation.
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Jul 30, 2015 02:22pm
Much has been said and debated about Pakistan Steel. Crux of the matter is that the situation calls for a pragmatic decision and not a political one. The present government clearly lacks the will to privatize Pakistan Steel. It fears a strong backlash from PPP if the privatization course is pursued with vigour. So, the government considers it the best option to keep paying the monthly salaries to the employees and to let the mills bleed to its imminent death. Would our PM have done the same thing for his own steel mill in Saudi Arabia if it had been a similar situation? Very likely that he would have got rid of the mill.
PM should bear in mind that it was the PPP government itself that pulled down Pakistan Steel from a very comfortable financial position in May 2008 to a cash strapped entity within five months of assuming power.The PPP government did nothing to reverse the damage it had inflicted upon the mills. Thus, PPP has no moral ground to oppose privatization of Pakistan Steel.
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Jul 30, 2015 02:38pm
Please don't sell your national asset to foreign powers..yes now china is your iron friend and you are trusting them. But in world politics situation changes..the best thing Pakistan can ask is for investment in this sectors like steel, cement, railways, infrastructure, airways but retain the majority of the stake hold of the industry with Pak govt and the people...the decision making power should rest with Pak govt..let the CEO be a Chinese who can run the company...
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Jul 30, 2015 03:24pm
We have been hearing not so good news about PS it looks like the union as well as the govt have joined hands to harm this institution which could have been a great source of earnings.
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Jul 30, 2015 03:40pm
Sure not only Steel Mills, PIA. Railways whould be privatised.But handed over to experienced managers, not lowest bidders.The present state of affiars have converted these as employemnt agencies for politicians specially PPP.
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Jul 30, 2015 03:44pm
It is about time Pakistan steel, the PIA, the Pakistan Railway are handed over to private entrepreneurs, with safe guards, so the greedy hands of the politicians are amputated. However the all these enterprises are loss making and not very attractive to private foreign investors - they are only interested in the land owned by these enterprises for a quick profit.
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Jul 30, 2015 03:49pm
Chinese are coming -
It seems in a big way.
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Jul 30, 2015 04:01pm
I hope our younger Pakistani generation don't end up have meager jobs within their country, and our Chinese friends bossing around in the coming 10-15 years time. only time will tell. So I suggest all thinks tanks to make sure our policies are governed such a way that it saves Pakistani nationals interest first.
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Jul 30, 2015 04:54pm
One more piece handed on platter to the Chinese. One by one we are slipping away from ourselves. Wonder when the Chinese will take over entire Pakistan?
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Jul 30, 2015 04:56pm
@Kamal Pasha Bro, Managers, office staff, floor shop managers, 50% of the workers will be Chinese and balance jobs of menial labour will be given to Pakistanis. Don't get agitated, this is what's going to happen, looking at the past exeriences of Chinese.
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Jul 30, 2015 05:09pm
Sounds great - but the only advantage of producing Steel in Pakistan vs China is labor cost and one of Pakistan's many problems is over staffing. Why would any businessman want to establish a energy intensive business in a country which has chronic energy shortage?
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Jul 30, 2015 07:13pm
Privatization means the assets are under the control of a private owner. This doesn't mean that Chinese are the only option. It should be an open bidding and whoever pays the most gets the assets. The gov't has no business hoarding these resources and making a mess of everything.
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Jul 30, 2015 07:51pm
@curious2 China, as on today, has 1 Billion Tons of installed capacity (to produce steel). Most of the steel plants are running under rated capacity. There is a huge glut of steel in world market. China is simply dumping steel wherever it can. Even Indian steel makers are not able to compete in India.
This situation is not going to change any time soon.
Not sure what exactly Chinese will do with PSM.
I worked at Bhilai Steel Plant for 8 years. I met two engineers from PSM who visited my plant some time in year 2000/01.
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Jul 30, 2015 09:01pm
This sounds like a good deal, but the Chinese won't agree to a bad deal. The share holders will get out from under a white elephant. They won't make a profit.
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Jul 30, 2015 09:11pm
@rehan ... Doubt the USA cares anything about Pakistan's steel mills. U.S. business is hugely involved with China. U.S. corporations have been doing business in China since 1990. Since then some smaller and mid sized American companies have moved their operations to China. My family does business with a Chinese company in Shen Zhen. WalMart and Nike are in Shen Zhen and Guang Zhou. The entire world does business with China.
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Jul 30, 2015 09:13pm
@noor ... It may be a successful deal, but in this case not a good deal.
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Jul 30, 2015 09:25pm
@niju ... Pakistan's steel mills are only assets in terms of employment. That fact is that "an asset" that does not make a profit is not an asset. It is only worth the scrap metal and the land it is sitting on. Obtain a copy of Pakistan Steel Mills Inc. annual report and compare long term debt to equity.
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Jul 30, 2015 09:30pm
@S. A. M. ..... The problem is that steel making in Pakistan is very labor intensive and union negotiations are stalemated. A Japanese Oxygen Plant can produce a heat of steel in 45 minutes. A Pakistan furnace produces a heat of steel every 19 hours. Pakistan is using a 19th century steel making technology. They are lucky to find any buyer.
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Jul 30, 2015 09:48pm
@PrasadDeccani ... What kind of number is 1 billion tons of installed capacity? What does that number mean? What time frame are we talking about? ... and why if China is dumping steel at less than full capacity would it want to buy more steel mills?
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Jul 30, 2015 09:52pm
Pakistan has one of the few industries like steel mil.that too they cant run efficiently.very disgraceful.and selling them to best friend
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Jul 30, 2015 09:53pm
China is east India company for Pakistan.soon they will totally dependent on China.
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Jul 30, 2015 09:56pm
Seems like good deal for China.they will extract ore from pakistans mines make it iron and sell it to Pakistan.
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Jul 30, 2015 10:02pm
No No to Chinese.
Give steel mills to Mithel of India. He is the only capable man to run it well.
Pakistan should not put all eggs in one basket.
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Jul 30, 2015 10:13pm
@Abbas Ali
The current concept is that you can put all the eggs in one basket, but must watch that basket carefully. No Mithal for Pakistan, please.
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Jul 30, 2015 11:16pm
They are of course interested..to steal our steel.
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Jul 30, 2015 11:17pm
Give it to them for FREE if necessary.......it will save the country's exchequer a lot of money.
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Jul 31, 2015 12:34am
Please give it to them for 100 year lease
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Jul 31, 2015 01:48am
@pervaiz iqbal Why no Mittal for Pakistan? Have you heard of IFFCO group in Pakistan? Google it to know more about it. By the way it's an Indian owned firm.
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Jul 31, 2015 03:12am
Good positive news. You can tell who your real friends are by their actions.
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Jul 31, 2015 06:28am
W should hand over Stell mills to Nawaz SHarif , he has good experience of stell and his mills are doing great business
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