ISLAMABAD, June 14: The Pakistan Steel is considering a plan to enhance mill's production capacity from 1.1. million tons to 1.5 million tons through its own resources.

Talking to Dawn here on Monday, PS Chairman Lt-Gen Abdul Qayyum (retired) said in view of the improved performance of the PS, the management might go for enlistment at the stock market to raise the equity to further expand its capacity from 1.5 million tons to three million tons during four to five years.

He said the Pakistan Steel had Rs8 billion which could be utilized for the initial expansion work without seeking any funding from abroad. Gen Qayyum said that a team from British consultancy firm Corus would arrive here next week to evaluate the technical aspects of the expansion plan.

These consultants would prepare a feasibility report in the light of which a decision could be taken about the revamping and expansion programme of the steel mills, he added.

So far, he said, Russia, China, Austria and Ukraine had offered assistance in the expansion programme. The PS chief said expanding the capacity from 1.1 million tons to 1.5 million tons could give additional sales of about 400,000 tons to the mills.

Responding to a question, he said although a MoU had been signed with Russia some time ago to undertake mill's expansion from 1.1 million tons to 1.5 million tons nothing concrete had been agreed between the two parties.

"Funding arrangements have not been finalised with Russia so far," he said and added that technically Russians, who built the Steel Mills, were in a better position to execute the expansion plan.

Gen Qayyum said that Chinese, who used to rely on Russian technology, were now ahead of Russia because of adopting advanced technologies. "Chinese are ready to extend 85 per cent loan for the expansion programme but they want us to negotiate the mark-up issue with Chinese banks which is not acceptable to us," the PS chairman said.

He was of the view that if the PS had to take loans at all, it could always look to Pakistani banks which would definitely offer better terms to it. "For us it would be ideal if the Chinese give us half of the assistance in aid along with 25 per cent interest-free loan as they have done in the case of Gwadar port," Gen Qayyum said.

In reply to a question, he said so far Russia had not communicated about the funding arrangements to expand the mill. "I met the Russian ambassador today and discussed with him various issues, including barter arrangements, to initiate the expansion programme," he said, adding that Pakistan could export a number of items to Russia and in return Moscow could help Pakistan undertake the expansion programme.

Earlier, talking to reporters, Gen Qayyum said that Pakistan Steel had achieved a significant turnaround. The steel plant, which was on the brink of oblivion a few years ago, is now running in profit.

He pointed out that there had been a record turnover of Rs45 billion against Rs41.5 billion achieved last year. Similarly, a record sale of Rs24.67 billion was managed which is 31 per cent higher than the budgeted sale target and 11 per cent higher than last year's sale, he added.