Federal government mulls new steel mill in Sindh
Deputy Speaker Syed Ghulam Mustafa Shah. Photo: APP
The Ministry of Industries and Production on Wednesday indicated a joint federalprovincial approach to rebuilding steel production capacity, confirming coordination with the Sindh government for the allocation of land to establish a new steel mill.
The house, which met under the chairmanship of Deputy Speaker Syed Ghulam Mustafa Shah, took up key issues relating to Pakistan Steel Mills (PSM), with the ministry outlining past shutdowns, workforce reductions and plans for future revival.
The sitting began with a delay of half an hour, after which a written reply from the Ministry of Industries and Production was tabled, providing detailed information on the current status and future direction of PSM.
According to the reply, production operations at Pakistan Steel Mills have remained suspended since 2015, a prolonged shutdown that has shaped subsequent policy decisions on restructuring, downsizing and alternative options for reviving steel production capacity in the country.
The government informed the House that 700 acres of land belonging to PSM have been allocated either for the establishment of a new steel mill or for revival initiatives, aimed at creating a viable framework for future industrial activity.
It was stated that efforts are under way to seek assistance from relevant institutions to obtain technical support and make the steel sector attractive for revival or fresh investment, with a focus on improving feasibility and long-term sustainability.
In this regard, protocols have been signed between Pakistan Steel Mills and Russia's Industrial Engineering Company, with the first protocol inked on July 10, 2025, followed by a second agreement signed on November 26, 2025.
The house was further informed that in May 2024, the Special Investment Facilitation Council (SIFC) decided that Pakistan Steel Mills would be scrapped, marking a decisive shift in policy after years of uncertainty surrounding the loss-making enterprise.
The ministry reiterated that, in collaboration with the Sindh government, approval has been granted for the allocation of land for the establishment of a new steel mill, underscoring a coordinated federal-provincial effort to rebuild steel production capacity.
On employment, the ministry said that out of 8,021 employees of Pakistan Steel Mills, 7,709 have been laid off, with only 912 workers currently retained, significantly reducing the organisation's operational footprint.
As a result of these measures, the monthly salary burden has declined sharply from Rs360 million to Rs40 million, easing what the government described as a substantial financial strain on the national exchequer.