Islamabad: The steel industry has requested the State Bank of Pakistan (SBP) to open letters of credit (LCs) for the import of essential raw materials, according to news published on February 6.
The news source mentioned that the industry is on the brink of collapse owing to several factors including; an increase in the price of international scrap, a shortage of raw materials, and successive depreciation of the rupee in the last 18 months.
According to a statement released by the Pakistan Association of Large Steel Producers (PALSP), the steel industry is a crucial sector for the country’s economy, which employs more than 200,000 people. The unavailability of raw materials and the collapse of trade finance limits have caused severe production disruptions and have put the industry in a jeopardy.
PALSP Secretary General Wajid Bukhari stated that the steel producers are facing a dire situation and require the support of SBP to acquire imports for keeping the factories running.
As per the statistics, steel production in Pakistan has collapsed by 50%. The news source disclosed that in the second quarter of the current fiscal year (Q2-FY23), the scrap imports were 616,000 metric tons in comparison to the same period last year, which stood at 1,235,000 metric tons. The PALSP has requested the SBP to help the industry from collapsing, even if they have to limit the ability of raw materials to 50% of last year’s volumes.
Iqra holds BS in International Relations and is passionate about writing engaging content on trending real estate topics. When not working, she is either spending time with family, shopping, or discussing shows & movies.
