The Competition Commission of Pakistan (CCP) has called on the government to implement a national steel policy and strengthen governance to fix major distortions in the steel sector. The commission emphasized that without policy reforms and stricter enforcement, compliant steelmakers will continue to suffer while untaxed and substandard producers gain an unfair advantage.
According to the CCP’s Competition Assessment Study of the Steel Sector in Pakistan, steel is a critical part of the country’s manufacturing and infrastructure development. Large Scale Manufacturing contributes over 69 percent of industrial output and 8.2 percent of GDP. Yet, Pakistan’s annual steel production of 8.4 million tons and low per capita consumption of 47 kilograms indicate weak industrial growth and stalled infrastructure expansion.
The CCP highlighted that Pakistan relies heavily on imported scrap, leaving costs exposed to global price volatility. Pakistan Steel Mills, a once-strategic asset with a capacity of 1.1 million tons, has remained closed since 2015 and carries liabilities of around Rs 400 billion.
In comparison, countries like China and India have successfully expanded their steel industries through coordinated policies, technology investment, and raw material sourcing. The CCP’s report notes that regulatory uncertainty in Pakistan—such as frequent tax changes, weak quality enforcement, and fragmented oversight—allows 50–60 percent of domestic production to bypass standards. Untaxed steel from former FATA and PATA areas adds to revenue losses, estimated at Rs 40 billion annually.
The CCP recommends establishing a dedicated Steel Ministry, improving coordination among industrial regulators, enforcing strict quality standards, and removing tax distortions. The report also encourages adopting advanced technologies like Direct Reduced Iron, supporting local iron ore mining, and promoting energy-efficient production to boost competitiveness.
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The CCP stressed that it will collaborate with stakeholders to implement these reforms. The goal is to promote fair competition, ensure sustainable industrial growth, and align Pakistan’s steel sector with international best practices.
