Two prominent steel business houses on Tuesday directly accused Riaz Laljee, a friend of President Asif Zardari, of manipulating policies to make massive illegal profits at the expense of the entire steel sector.

They say there is a deep sense of anguish among the steel sector industrialists that the Federal Investigation Agency (FIA) is sacrificing the sheep to save the wolf.

Nauman Wazir, chairman industrial trade advisory cell, member Pakhtunkhwa Chambers of Industries and CEO of Frontier Foundry (Pvt) Ltd told The News that arresting some small steel industry people and announcing arrest of many others is basically a dirty plan devised by the Abbas Group owned by Riaz Laljee, who has benefited a lot from generosity of the PSM management and got numerous contracts of steel billets and other products in bulk in complete violation of rules. Nauman Wazir said that Laljee by using his contacts has procured almost all the production of the billets, which are only manufactured at PSM.

He said that by doing so Abbas Group has established complete monopoly on the market and has inflicted losses of billion of rupees to the profit earning Pakistan Steel Mills. Nauman said that to pull the PSM out of the massive crisis, Rs25 billion is being given as bailout package from taxpayers money instead of recovering it from Laljee.

Another Peshawar-based steel industrialist Zarak Khan Khattak while talking to The News said that in fact revenge has been taken from the Supreme Court of Pakistan, which in 2006 had cancelled the wrong privatisation of the PSM.

Zarak said that unfortunately because of loss of billions inflicted to the PSM, which had resulted in shut down of more than 80 per cent of the PSM, the countrys biggest steel unit now even could not be privatised.

"In 2006, PSM was a running unit. Though its privatisation was on throwaway price was wrong but if we consider the present situation one can say that it would have been better if the PSM had been privatised at that time. At the moment no one will ever think of buying it even at the price which was declared "peanuts" in 2006," Zarak Khan commented. Zarak was of the view that soon the entire industrialists community will be on the roads against these dirty policies. He said that in order to save only one person, Riaz Laljee and the money he got from PSM, the whole system is being put at stake, which would destroy the country's economy and the steel industry.

He said everyone knew that Riaz Laljee is the owner of the Abbas Group companies and now innocent people of Pakistan are being ridiculed by saying that that in papers Lalji is not the owner and that his wife or daughter owns these entities.

He said that Riaz Laljee has intentions of involving 106 consumers/dealers of Pakistan Steel Mills into the investigations being carried out against him to create a mess. He said that around 400 directors of these 106 companies might be arrested or harassed and one day it will be announced that since 106 traders are involved in this scam, everyone including Riaz Laljee should be granted amnesty.

He said small traders purchase 200 to 300 tons of billets, while Laljee has bought them in bulk, somewhere in the range of 40,000 tons. Zarak said that all eyes are focused on the Supreme Court, which so far has not taken any action and has not passed any orders against ill treatment and humiliation of the steel sector industrialists.

Meanwhile, Pakistan Steel Re-Rolling Mills Association (PSRMA) has sought a meeting with Federal Investigation Agency (FIA) director general to state its members positions about the deals with Pakistan Steel Mills that are being investigated.

PSRMA chairman Asmat Pervaiz has written a letter to FIA DG, requesting time for a meeting.

An FIA official said they received the request and that the meeting would be scheduled soon. He said that FIA was investigating the issue on instructions from the Supreme Court and was not biased against anyone.

The chairman said Pakistan Steel Mills had not blamed re-rolling mills for the wrongful gains being investigated, but FIA officials were harassing the members of PSRMA. He said that the meeting would end the uncertainty affecting the whole industry.

Pervaiz said FIA had registered FIRs against some of PSRMA members, which led to panic across the steel re-rolling industry. He said that mills were not ready to lift raw material from PSM, which was creating a cash flow problem for it.

"The trust deficit between dealers, re-rollers and PSM has been increasing, which may lead to collapse of PSM business," he said.

Source: The News