Established in the 1970s with Soviet assistance, Pakistan Steel Mills is the largest industrial corporation in Pakistan. Employing 30,000 workers at its height production capacity of 3.0 million tonnes of steel and iron foundries per annum, the PSM is spread out over an area of 7,550 hectares, making it one of the largest industrial complexes in Pakistan as well as in South Asia. It has its own educational facilities (Pakistan Steel Cadet College and Pakistan Steel Institute of Technology), housing and residential programs, parks, and recreation facilities.
However, the PSM has been in a stage of constant decline, to the point where it is slated for privatization, likely at a fraction of its value. Lack of modernization and corruption are cited as the major reasons for its decline.
Russia has once again offered to revive the PSM, which would entail the transfer of Russian equipment, machinery, technical knowledge, and experts to Pakistan, in a bid to resurrect PSM back to its former glory.
The importance of Steel cannot be overstated for a developing country. It is the most sustainable and the most recycled product on earth and is used in every important industry: energy, construction, automotive and transportation, infrastructure, packaging, and machinery.
Steel is used in buildings, as concrete reinforcing rods, bridges, infrastructure, tools, ships, trains, cars, bicycles, machines, electrical appliances, furniture, and weapons.
The steel industry is a major source of tax revenue, foreign exchange, and investment for the government.
While there has been plenty of talk about the integration of Pakistan into the Eurasian Union, and about the opening up of Russian, Central Asian, Chinese, and European markets for Pakistan, the state of the PSM tells its own woeful story about a nation in decline, and about its lack of an industrial base that can contribute to exports and play center stage in foreign relations with other countries.
Since steel is used as an input in many other industries, it has the unique property of being able to kick-start and revive an economy in decline.
Inherent in the Russian offer to revive the PSM, therefore, is the rebuke and the advice to Pakistan to set its house in order, since the PSM is no longer a symbol of Pakistani progress, but of its decline; its corruption, and of the government's apathy to the pandemic.
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