Pakistan Association of Large Steel Production - PALSP, Pakistan Association) notes that Pakistan’s black metallurgy, which plays an important role in the country's economy, is in a deep crisis state. Many steel plants are closed, and the continuing to function are loaded by 20-30%, faced with high production costs and a drop in demand for finished products. According to PALSP estimates, without immediate and decisive intervention of the state of the industry, it threatens to complete collapse, which will lead to the elimination of thousands of jobs and further exacerbation of internal political instability in the country.
, the experts of the association call the sharp increase in electricity prices, the volatility of the Pakistani rupees, high percentage rates for loans and loans and loans, and credit rates, and credit rates and the Reducing the demand for metal.
a record account, which reached 22%in 2023, made loans for manufacturing enterprises virtually inaccessible. The Central Bank began its cycle of reducing bets in June 2024, reducing them from a record 22%.
After a small break in March 2025, which followed a series of reduceds by 10 basic points, the State Bank resumed a decrease by 100 basic points in May, but again left the rate of unchanged in June on the follain of the tension between Iran and Israel. The indicator in July in July is 11%, Metallurgists believe, is clearly not enough: to restore the industry, the Central Bank rate should not exceed 5-6%.
The demand for steel, according to the association, fell largely due to the revision and reduction of financing the public sector (Public SecTOR DEVELOPMENT Programme - PSDP), which is an instrument of budget support for promising projects. At the request of the IMF, the volume of the program this year was reduced both by the number of projects implemented and in terms of financing from $ 5 billion to $ 3 billion.
At the same time, the Pakistani government, jointly with the position of the currency fund, notes that the PSDP funds are sprayed, projects are unacceptably delayed without giving the proper economic effect. In this regard, the country's leadership went to a sharp reduction in the total number of projects implemented within the framework of PSDP in order to concentrate on the timely implementation of the most priority initiatives.
for the current year, 1071 development project was planned, of which only 105 approached the completion with a readiness of 80% and higher. In the first five months of 2025, the pace of development of the programs of the program was extremely low: nine ministries used 12 to 19%of the allocated financing volumes, six ministries spent a little more than 5%, and 5%did not reach 27 ministries and departments. At such a pace
