ECC Approves Winding Up Of Pakistan Textile City
The Econo-mic Coordination Committee (ECC) of the Cabinet has approved winding up of Pakistan Textile City Limited (PTCL) after clearance of the companys liabilities and transfer of its land to the Port Qasim Authority (PQA).
Sources said the company faced with financial hardships was considering selling its 200 acres of land to K-Electric to set up a coal-fired power plant. A summary was also moved to the ECC in this regard and, in response, the Prime Minister ordered the winding up of the company after completing the necessary requirements, including clearance of liabilities.
A meeting of the ECC held with Finance Minister Ishaq Dar in the chair has recently approved Rs12 million on the request of Finance Division for the settlement of outstanding liabilities to wind up the PTCL.
An unlisted public company namely PTCL, with registered office at Karachi, was established in May 2004 as part of export processing zone in Karachi, Lahore and Faisalabad. It was established following a decision of Cabinet Division in July 19, 2013 to establish special textile export processing zones.
The companys establishment was aimed at providing textile sector with infrastructure to enable it to move for value addition and its expansion in size and volume to compete in the national market.
With a view to implementing the project, the company obtained a certificate from Securities and Exchange Commission of Pakistan (SECP) on Jan 1, 2015 for commencing its business.
The major shareholders of PTCL are the federal government (56 per cent shares) and Sindh government (16pc shares). The companys objectives were to create, implement and manage an exclusive area for value added products.
The progress of work for establishing the textile city was, unfortunately, said to be marred with a number of impediments like non-availability of electricity, gas and water and as such the textile city could not make progress on the ground. These issues remained unresolved despite approaching the relevant forum time and again. The companys accounts were also blocked by National Bank of Pakistan (NBP) due to non-payment of principal amount.
A meeting of Board of Directors (BoD) was convened on Nov 17, 2016 on winding up of the company. The meeting decided that due to non-availability of financial resources and required infrastructure, including natural gas, the company was unable to continue its existence and, as decided by the committee formed earlier by the federal government, the process of voluntary winding up started as laid down in the Companies Ordinance 1984.
The PTCL has intimated that the process of winding up of the company be started after the clearance/payment of outstanding liabilities, financial obligations up to Rs12m. The Finance Division was requested to approve Rs12m as equity share of the government of Pakistan.
While approving the winding up of the company, sources added that the PM directed that all the assets of the company should be disposed of through an order of transfer to the PQA, which originally leased the land to the PTCL as the terms of lease do not allow its further sale or transfer to a third party.