Islamabad: Pakistan Association of Large Steel Producers (PALSP) has urged the government to release the Public Sector Development Program (PSDP) funds in a bid to revive the industry and economy after the massive destruction caused by the heavy floods, according to news published on October 24.
The PALSP stated that releasing funds will help stimulate economic growth and generate employment opportunities. As per the details, under PSDP, the government has allotted a federal budget of PKR 800 billion for the fiscal year 2022-23. The news source mentioned that during the first quarter of the current fiscal year, the government decreased the development expenditure by amending the release strategy of funds. It was disclosed that the government drastically cut the release of funds from 20% to 10%. Further, it was informed that no funds were released during the last quarter of the fiscal year 2021-22.
According to details, due to the non-availability of funds in the national kitty, the government stopped releasing funds for development projects. This led to a slowing down of economic activity and almost all government projects are at standstill. The news source stated that because of low PSDP spending, the steel industry was under pressure and concerns increased after the reduction in the PSDP funds released.
Reportedly, the major demand driver for the steel industry is the PSDP expenditure. Mostly, the business comes from government contracts including highways, dams, airports, and much more; work on all projects is halted. With the devastating floods in the country, the situation has worsened. The recent flash floods have left the roads and railways badly damaged, the supply chain is hurtled down, and demand is adversely affected. Also, the heavy rains have wreaked havoc on the offtake steel units and stopped production.
The PALSP has appealed to the government to take necessary steps in order to revive the steel industry. It was mentioned that a special package like reduced interest or markup rates, and decreased gas and power tariffs should be introduced for the revival of the industry. Reportedly, the Federal Board of Revenue (FBR) has come up with an incentive package for steel long products.
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.
