LAHORE: The Steel Melters’ Association (SMA) is satisfied over the imposition of 15 percent regulatory duty on the import of various steel products in the country. It will help to protect the interest of local steel manufacturers.
The SMA’s views are expressed in a resolution passed during a meeting headed by its Chairman Javaid Iqbal.
Reviewing the overall situation of the country’s steel sector, the meeting discussed in detail the problems being faced by the industry and showed their satisfaction over the recently issued SRO 18 (I)/2015 by the Federal Board of Revenue, which imposed regulatory duty of up to 15 percent on import of various steel products amid criticism from the steel industry.
The meeting also discussed the long-awaited issue of Tuwairqi Steel Mills Limited (TSML) which has already invested around $450 million as Foreign Direct Investment in the country in the steel sector.
The TSML has virtually become the pioneering industry, as it has for the first time introduced world renowned Japanese technology of Direct Reduction of Iron (DRI) in Pakistan. DRI is a value added virgin raw material with consistency in quality while mixed with the remeltable scrap. Its use in the induction furnaces/ electric arc furnaces definitely improves the quality of the billets produced.
It is to be noted that the melters’ opinion is based on their own experience of using DRI procured from TSML. It was noted with concern that the company, despite achieving 100 percent capacity test run, is in its shut down mode since September 2013. The primary reason for this situation is the non-application of the feed stock gas tariff initially indicated to the company by the government of Pakistan.
In the region, India is the largest producer and consumer of DRI and so are the other neighbouring countries.
The meeting expressed extreme concern over the closure of a state-of-the-art steel production facility, which is among the best in the region and observed it would be a big loss to the country in general and steel sector in particular. The meeting resolved that natural gas tariff issue of TSML needs to be addressed at the earliest possible by the government, according to the recommendations of relevant ministries.
