KARACHI: As Pakistan seeks Chinese assistance to revive the loss-making mega-corporation, Pakistan Steel Mills (PSM), officials and stakeholders believe it could take three to four years to bring its non-operational plants back to life.
Prime Minister Imran Khan left for Beijing on Monday to discuss the China-Pakistan Economic Corridor (CPEC) and regional security issues with the Chinese leadership.
He is also expected to request Chinese authorities to help revive the steel mill that has remained nonfunctional since 2015 and bleeding Pakistan financially.
“Two months ago, our committee was briefed about the status of PSM and its revival plan. We were informed that some Russian and Chinese companies along with local groups were interested in bringing it back to life,” Sajid Hussain Turi, Chairman of National Assembly’s Standing Committee on Industries and Production, told Arab News on Monday. “The revival of Pakistan Steel Mills will be a welcoming step.”
The stakeholders expect the Chinese companies to bring enough expertise to revive the steel mills. “The Chinese showed a keen interest in rejuvenating the place in a meeting held a couple of months back with PSM board of directors,” Munir K. Bana, the board’s top official, told Arab News
Pakistan Steel Mills was constructed in 1973 under an agreement signed between the country’s administration and the erstwhile Union of Soviet Socialist Republic (USSR) in 1971. The Soviets also agreed to provide technical and financial assistance for the construction work.
The megacorporation saw a decline in production between 2008 and 2015. It was finally shut down when the company failed to pay Rs20 billion of the gas bill.
“So far the accumulated losses of the steel mills have increased to about $11 billion due to the closure of plants and imports of steel products,” said Mumrez Khan, convener of PSM Stakeholders’ Group that comprises employees, pensioners, suppliers, dealers, and contractors.
The country has been exploring various options to resolve the issue of Pakistan Steel Mills, including its privatization.
Recently a decision to put PSM on the privatization list was taken up in a meeting of the Economic Coordination Committee (ECC) of the cabinet that was chaired by prime minister’s adviser on finance, Dr. Abdul Hafeez Shaikh. However, it was later decided to revive the defunct entity, instead of privatizing it.
“The daily losses are estimated to be around Rs120 million due to the closure of plants,” Khan claimed. “About Rs80 billion of PSM Stakeholders’ Group are also with the mill. Our three-month salaries remain pending as well.”
Officials expect that the revival of the defunct steel mills would take about three to four years and billions of rupees since its plants desperately need replacement of machinery and equipment.
“In my personal view, the machinery will have to be replaced completely since it is beyond repair at this stage,” Bana commented.
Spread over an area of 18,600 acres with 10,390 acres for the main plant, Pakistan Steel Mills is located 40 kilometers from Karachi in the Port Qasim vicinity. The PSM had a production capacity of 1.1 million tons of steel which was expandable to 3 million tons per annum. The main PSM products included coke, pig iron, billets, cold-rolled sheets, hot-rolled sheets, and galvanized sheets.
Pakistan to invite Chinese assistance for revival of steel mills
Pakistan to invite Chinese assistance for revival of steel mills
- PM Khan likely to discuss the plan with Chinese authorities during his current visit
- Experts believe the mill may take three to four years to become operational again
Pakistan offers seaport for global cargo transshipment amid Gulf conflict escalation
- Karachi Port Trust says its services can ensure ‘continuity and stability’ of maritime trade
- The region is currently witnessing significant disruptions to global trade and oil shipments
KARACHI: Pakistan has offered its Karachi seaport for uninterrupted global cargo transshipments as escalating Middle East tensions threaten maritime trade, the country’s largest port operator said on Friday.
Iran has been rocked by joint US and Israeli strikes since Feb. 28 that killed Supreme Leader Ayatollah Ali Khamenei. Tehran retaliated with missile and drone attacks on US, Israeli and allied targets across the Gulf, plunging the region into conflict and uncertainty.
The escalation disrupted air travel, heightened military activity, and disrupted shipping through the Strait of Hormuz, a key route carrying roughly 20 percent of global oil shipments.
The Karachi Port Trust (KPT) said in a statement it was ready to support international shipping lines by offering transshipment services to regional ports, helping ensure the “continuity and stability” of global maritime trade.
“Karachi Port Trust remains fully prepared to support the international maritime community and to provide reliable, efficient, and secure port services in the interest of sustaining regional trade connectivity,” KPT Chairman Shahid Ahmed said, according to a statement circulated by the port authority.
It added the facility could help stabilize maritime trade by offering transshipment services for cargo destined for ports across the region.
The statement said as a demonstration of its capability, international vessels MV TS TACOMA and MV TS SYDNEY arrived in Karachi and discharged large number of containers as transshipment cargo.
“The containers will subsequently be transshipped from Karachi to Jebel Ali in the Middle East,” it continued.
Pakistan Maritime Affairs Minister Junaid Anwar Chaudhry on Thursday highlighted the importance of the Gwadar port city’s transshipment role as major shipping routes face disruption from the ongoing conflict.
The developments come as the Strait of Hormuz, a strategic waterway between Iran and Oman and one of the world’s most critical oil transit routes, has been blocked by Iran which has threatened to attack ships that attempt to transit through it.
US President Donald Trump has assured shipping companies of naval escorts and insurance support to protect vessels.
The escalating tensions have contributed to a sharp rise in energy prices and significant disruptions to tanker traffic through the strategic waterway.
Pakistan has long viewed its seaports as strategic assets that could boost trade with Central Asia and the Gulf region, while helping the country earn valuable foreign exchange.
