The Ministry of Industries and Production is going to hire a private firm for determining the exact production cost of steel and other commodities in Pakistan.
During a meeting of the senate standing committee of Industries and Production here on Tuesday, officials of the Ministry of Industries and Production informed that the services of a private firm would be sought for determining the exact production cost of steel and other commodities in Pakistan so that the prices could be fixed accurately.
The meeting of the Committee was chaired by Senator Faisal Sabzwari.
Senator Muhammad Abdul Qadir asked as to why the price of steel is rising in Pakistan. And if we import the same steel, what effect will it have on prices?
Officials of the Engineering Development Board (EDB) said that work is underway in this regard and matters will be sorted out in collaboration with the representatives of the concerned industries.
Representatives of the Pakistan Association of Large Steel Producers informed the committee that about 400 companies are currently making steel in Pakistan. And most of the steel in Pakistan is made from imported scrap. As the price of scrap increases in the global market, so does the cost of production, which in turn causes prices to rise.
Senator Saifullah Khan Niazi said that the committee was trying to make cheap steel available to the people. There are other industries connected with the steel industry. And price increases affect everyone. The committee members sought all the details at the next meeting of the committee for accurate determination of steel production cost and prices.
During the meeting the ministry and Pakistan Steel officials gave a detailed briefing to the committee on the question posed by Senator Mushtaq Ahmed in the senate session regarding the audited accounts of Pakistan Steel Mills Corporation (Pvt) Limited. The total losses and liabilities of Pakistan Steel have increased by Rs67.167 billion from June 30 to December 2020.
Officials informed that Pakistan Steel Mill started production in 1985. The mill made a profit of Rs9.54 billion. Pakistan Steel Mills has been running a deficit since 2008 due to global recession and other factors. The company incurred a record loss of Rs26.45 billion in 2008. From 2008 to 2014, Pakistan Steel Mills received about Rs59 billion as bailout but the company could not be revived.
Pakistan Steel Mills has incurred a total loss and liability of Rs67.1 billion from June 30, 2020 to December 31, 2020. Pakistan Steel officials said that so far about 5,000 employees have been laid off through golden handshakes. And after receiving the funds from the Ministry of Finance, the affairs of more employees will also be looked into.
The meeting discussed in detail the status of declaring mining as a formal industry by the Government of Pakistan. The mining sector is a provincial matter after the 18th Amendment, ministry officials said. As far as the federation is concerned, it is looked after by the Ministry of Petroleum. “We have written a letter to the Ministry of Petroleum. As soon as the Ministry approves it, a notification will be issued to declare mining as an industry. The chairman of the committee asked what are the benefits of declaring mining as a separate industry. Officials informed that the industry’s status makes it easier to get loans from banks and other tax matters. Which will make further progress in this field possible.
Public petition filed for setting up of PIDC Regional Office in Quetta, Balochistan was discussed. The Secretary, Ministry of Industries and Production said that there was no need to set up a regional office of PIDC in Quetta. The secretary of the ministry further said that there was no plan of PIDC nor any projects in Balochistan and therefore there was no need to set up an office in Quetta.
The committee members also considered in detail the production of vehicles and the issues faced in this regard. The committee was informed that 65 per cent of the parts for vehicles manufactured in Pakistan are imported. Senator Abdul Qadir inquired that despite the fact that the vehicles are expensive; the vehicles manufactured in Pakistan are not up to the standard.
EDB CEO said that under the new policy, companies are required to make arrangements to manufacture vehicle parts locally over time, So that vehicles made in Pakistan can be exported abroad as well.
Best Post ever about steel commodities