PM to offer PSM to China

ISLAMABAD: Prime Minister Imran Khan has decided to offer handing over Pakistan Steel Mills (PSM) to China through government to government deal and exploring options to finance multi-billion dollars railways Mainline (ML-1) during his upcoming visit of Beijing.

More: PM to visit China for discussing CPEC expansion

Pakistan’s top leadership will give assurances to Chinese side that China Pakistan Economic Corridor (CPEC) would not slow down, but its next phase would be pursued with zeal and vigour despite passing through under the IMF programme.

In his upcoming scheduled visit of China from October 07, 2019, the prime minister has decided to take up five issues for enhancing economic cooperation under CPEC. Pakistan will offer China to get PSM, finalise deal on modernisation of ML-1, financing of Bunji hydropower project, agriculture and social sectors-related projects in and outside the ambit of CPEC.

Related: Has CPEC been shelved?

“Yes, the government will seek assistance for construction of Bunji dam,” top official sources told The News here Saturday.

The Chinese side wants to see progress for establishment of CPEC Authority so the government intends to go ahead with promulgation of presidential ordinance anytime around the upcoming visit of Imran Khan to China.

On the other side, the parliamentarians have asked the government to avoid path of promulgation of ordinance as it would undermine the Parliament. Now it is yet to be seen how the government finally decides to move ahead on CPEC Authority as the Chinese side does not want to make things related to CPEC controversial. Another ordinance is also on the cards where Gwadar Port will become enabled to deal transit trade. The FBR has agreed to grant taxation concessions to Gwadar Port and presidential ordinance will be issued anytime.

On issue of cash-bleeding PSM, official sources said that the premier got worried in the wake of continuous and uninterrupted losses on monthly as overall accumulated losses went up to Rs220 billion. The Privatisation Commission has sought application for financial adviser in order to explore options to revive the PSM and then run it on professional lines.

“The government is exploring different options including G2G deal with China as the government cannot absorb losses on consistent basis,” said sources, and added that the premier decided to offer China to handover PSM with full management control to revive this sick unit.

Financing of ML-1 for modernisation of rail line from Peshawar to Karachi will be another agenda item of the premier during his upcoming visit as both the countries so far failed to finalise financing deal of this much-awaited project. “Pakistan is finding it quite hard to finalise loan deal when the country is running under the IMF programme,” said the official sources.

The premier will make last ditch effort to find out solution to this problem and both sides might explore option to construct this multi-billion dollars project on BOT basis, but Pakistan will have to give total management control of rail line to Chinese side.

For construction of Bunji dam, the sources said, Pakistan would seek financial assistance from China to move ahead on this project on fast-track basis. The agriculture-related projects would also come under discussion. Social sector projects, especially scholarship for Pakistani students, would also be materialised.

The sources said that it was not known how the government wanted to move on establishment of special economic zones (SEZs) as it’s a critical area where Pakistan can attract Chinese companies for relocation and could become part of international supply chains for boosting up its exports in months and years ahead.