Economic Coordination Committee (ECC) during its meeting on Saturday decided not to privatize Pakistan Steel Mills (PSM). After careful consideration the committee decided to inject fresh capital of Rs.2.9 billion into the largest industrial company in Pakistan that employs over 17000 people. Government also decided to seek a strategic partner that will be offered a minority stake along with management control of the company. The steel mill is operating at just 20% of its capacity.
IMF laid down the condition that government should privatize all commercial enterprises to reduce fiscal deficit and develop private sector. PSM, WAPDA and Pakistan International Airline (PIA) are the three largest loss generating public enterprises. Prior efforts to privatize PIA and PSM has generated public backlash mostly driven by political parties. These enterprises have become center of political hiring to facilitate political party supporters and members.