ISLAMABAD: The steel industry has expressed the confidence to export various iron and steel products provided the government makes policy change regarding sales tax refunds.
In a letter to the Ministry of Finance, Pakistan Association of Large Steel Producers (PALSP) has said that steel products could be exported if the government ensures timely payment of sales tax refund to the exporters under the Special Procedures.
“Without introducing any incentives that the government is giving to other export-oriented sectors and by simple adjustment in the sales tax refund the steel industry could be made viable for exports,” the association said.
In order to realise the full export potential of the sector, the steel industry has suggested that a mechanism should be put in place where steel exporters under the Special Procedures would be able to get a timely sales tax refund.
The letter said that some of the leading steel industries have received queries from some Middle Eastern countries regarding imports, as many local steel units meet international standard and quality.
The local steel manufacturers have made large investments for modernising their plants during the last few years to produce construction bars and billets as per international standards.
The capacity of steel plants due to continuous expansion has increased manifolds. Keeping in mind the recent slump in domestic demand, there is massive overcapacity in the domestic market that can be exported to regional countries that are net steel importers such as Afghanistan, UAE and Sri Lanka.
Published in Dawn, May 26th, 2019