The Competition Commission of Pakistan (CCP) has released its Competition Assessment Study of the Steel Sector, highlighting structural and policy challenges that undermine competitiveness in a key industrial segment.
Pakistan’s manufacturing sector contributes around 71pct of exports and employs 15pct of the workforce, with steel underpinning construction, infrastructure, and industrial growth. In FY 2024, domestic production reached 8.4 mln tons (4.9 mln tons long steel, 3.5 mln tons flat steel). Yet the sector remains heavily import-dependent, with 2.7 mln tons of scrap imported, and per-capita steel consumption at just 47 kg, far below the global average.
The report flags the absence of a national steel policy and recommends a dedicated Steel Ministry, taking cues from China and India. Pakistan Steel Mills (PSM), once a strategic asset with 1.1 mln tons capacity, has been idle since 2015, saddled with huge liabilities and obsolete technology.
Growth is constrained by high energy costs, import reliance, weak raw-material integration, and regulatory inefficiencies. Substandard steel accounts for 50-60pct of output, while 1.5 mln tons of untaxed steel from ex-FATA/PATA regions erode revenue. Many mills operate at 20-30pct capacity, hindered by high tariffs and limited financing, the report added.
CCP recommends a national steel framework to stabilize regulations, rationalize taxes, enforce quality, formalize undocumented units, and expand the Ease of Doing Business Committee to include industry experts. For long-term competitiveness, the report urges adoption of Direct Reduced Iron (DRI) technology, local iron ore mining, and green, energy-efficient production.
