The PTI led federal government on Wednesday decided to terminate all 9,350 employees of the Pakistan Steel Mills (PSM), taking a giant but politically difficult step to stop years long hemorrhaging instead of reviving the country’s largest industrial unit.
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There are 9,350 employees who will be fired within a month and another 250 will be let go within three months. The ECC approved a Rs18 billion package for the employees, which amounts to Rs2.3 million per person.
Though the Mills have been closed for years, they are running a Rs550 billion deficit and billions are being spent on debt servicing.
The government has made noise about wanting to restart the Mills but so far nothing has been done.
The move will not be finalised until it is approved by the federal cabinet.
The ECC also set up a body to explore options to hedge oil prices. The ECC decided to set up a committee headed by PM’s Special Assistant on Petroleum Nadeem Babar and representatives from the State Bank of Pakistan (SBP), Pakistan State Oil (PSO), Finance Division, Petroleum Division, Law Division and Planning Division to explore options for 15 million barrels of oil for one or two years –divided in 12 equal monthly amounts — for different stock prices above the current Brent as long as the fee is within acceptable range.
Under the TORs, which can be readjusted by the committee in the light of future developments, PSO will act as the counter-party while the Ministry of Finance shall give a guarantee of performance by the PSO, according to a Finance Ministry statement.