Banks' refusal to clear LCs a devastating blow to local steel industry

February 08, 2023 (MLN): In a major setback for the local steel industry, the steel companies are facing closure due to the denial of clearing Letters of Credit (LCs) by banks.

The industry, which employs over 200,000 workers and contributes a significant amount to the national economy, is in dire need of $150 million to import raw materials and continue production.

The impact of the closure of the steel industry is far-reaching and will be felt by not just the workers who will lose their jobs but also by the national economy.

The steel industry contributes a staggering Rs255 billion to the exchequer, and its closure will be a significant blow to the country's finances.

Moreover, the closure of the steel industry will also slow down the rehabilitation work for flood-affected areas, as steel is an essential component in rebuilding efforts.

This will further compound the problems faced by the affected communities and delay their recovery.

The banks' refusal to clear the Letters of Credit is a cause for concern, and the local steel industry is calling for immediate action to be taken to address the issue.

The companies are urging the government and the banks to work together to find a solution that will allow them to continue operating and protect the jobs of the workers who depend on the industry for their livelihoods.

The future of the local steel industry and the livelihoods of over 200,000 workers hang in the balance, and it is essential that the government and the banks act swiftly to prevent the closure of the industry and the devastating consequences that will follow.

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