ISLAMABAD: The government is considering a proposal to establish a new steel mill in Karachi with Russian cooperation, as both countries have agreed to form working groups to advance the project.

In this regard, Deputy Minister of Industry and Trade of Russian Federation Aleksei Gruzdev met Minister for Industries, Production and National Food Security Rana Tanveer Hussain on Wednesday.

Mr Tanveer informed the Russian minister that 700 acres of dysfunctional Pakistan Steel Mills (PSM) had been earmarked for establishing a new steel-producing facility. The proposed site is located in Karachi and is close to Port Qasim, which reduces the cost of transportation of raw materials.

He said despite having considerable reserves of iron ore (estimated reserves of 1,887 million tonnes), Pakistan is forced to import around $2.7 billion of iron and steel.

There is a perpetual gap between domestic production and demand for iron and steel. The gap is estimated at 3.1m tonnes for the last year.

Pakistan’s per capita steel consumption is below even those of developing countries, indicating significant growth potential over the medium and long term.

Mr Tanveer said the efficiency of Pakistan’s steel industry is limited as it is segmented (600 small units) and based on old, inefficient technology.

Pakistan’s industrial and agricultural experts are set to visit Russia, marking a significant step in strengthening bilateral ties between the two nations. He stressed the need for modern agricultural machinery to boost crop yields and enhance agricultural productivity. He said the government will provide all the facilities to the Russian investors.

Aleksei Gruzdev said Russia will provide Pakistan with modern agricultural machinery to boost crop yields and enhance agricultural productivity.

Published in Dawn, September 19th, 2024