ISLAMABAD: The Pakistan Tehreek-e-Insaf (PTI) government is looking to revive Pakistan Textile City Limited, reversing the previous government's decision to wind up the ailing company, The Express Tribune has learnt.
The Textile Division has submitted a summary towards this end to Prime Minister Imran Khan, a government official said.
Pakistan Textile City was established in Karachi in May 2004 as a joint venture between the federal and Sindh governments and several financial institutions. The company was set up with Rs1.25 billion in paid-up capital and used Rs993 million from this amount to purchase 1,250 acres of land from the Port Qasim Authority (PQA).
Textile value addition: Govt taking steps to make industry competitive
Although the company obtained a loan with credit limit of almost Rs3.2 billion from the National Bank of Pakistan (NBP) for infrastructure development, it could not take off on account of various impediments, like unavailability of electricity, gas and water.
In May 2016, when he was asked to decide the company's fate, then prime minister Nawaz Sharif directed that the Pakistan Textile City be voluntarily wound up by way of transfer of all its assets to PQA. PQA, in turn, was directed to settle outstanding liabilities of the textile city using its own resources. The Finance Division was assigned the lead role in the winding up process.
The process, however, came to a halt due to non-settlement of the loan the company acquired from NBP, officials said. PQA also did not commit to clear other outstanding liabilities like salaries of Pakistan Textile City employees and dues of utilities pending since April 2017.
In light of these developments, Prime Minister's Adviser on Commerce and Textile Abdul Razak Dawood decided to explore options to revive the Pakistan Textile City, said officials. On the request of Prime Minister's Office, the Textile Division prepared a viable business plan in consultation with the stakeholders concerned.
The plan was submitted to the PM Office on December 10 last year and is awaiting approval.
In a recent Economic Coordination Committee (ECC) meeting, the Textile Division explained that it had requested the Finance Division for funds to clear outstanding bills and liabilities of the Pakistan Textile City since April 2017. The Finance Division had advised the Textile Division to seek ECC's approval for the release of requested funds.
The ECC approved the Textile Division's proposal to grant Pakistan Textile City Rs14.3 million for paying outstanding salaries and clearing other liabilities so that its day-to-day affairs are managed while a final decision on its fate is awaited.
Published in The Express Tribune, March 23rd, 2019.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ