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Smuggled steel infiltrating Pakistan


In a startling revelation that has sent shockwaves through Pakistan’s local steel industry, it has come to light that an alarming influx of large-scale smuggled steel has been infiltrating the country’s borders with official patronage, perpetuating a devastating blow to the domestic manufacturing sector and incurring colossal financial losses to the national exchequer on an unprecedented scale.
The Pakistan Association of Large Steel Producers (PALSP) issued a grave warning about the future of the country’s steel industry as the relentless smuggling operations continue to wreak havoc. “With billions of rupees of investments at stake, urgent action is needed from the government to save this crucial economic pillar,” stated Wajid Bukhari, Secretary General of PALSP.
The smuggling of steel bars from neighbouring Iran and Afghanistan has reached alarming proportions, posing a significant threat to Pakistan’s steel industry. PALSP estimates that approximately 500,000 metric tonnes of steel are smuggled annually, resulting in a staggering tax revenue loss of Rs25 billion.
Emphasising the critical level smuggling has reached, Bukhari said, “If immediate action is not taken, irreparable damage will occur to our industry.”
Speaking to The Express Tribune, JS Global’s Steel Sector Analyst Waqas Ghani Kukaswadia noted that smuggled steel rebars have long been present in the country, with around half a million tonnes smuggled across the border each year. However, the situation has worsened due to the influx from the Federally Administered Tribal Areas (FATA) and Provincially Administrative Tribal Areas (PATA), where quotas and exemptions have been exploited.
PALSP has repeatedly urged the government to address the issue, but their efforts have largely been ignored. Temporary raids have been conducted, but they fail to solve the underlying problem.
Published in The Express Tribune, May 17th, 2023.
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