Government invites recommendations on draft Steel Policy

Ministry of Industries and Production is currently in the process of finalizing the country’s Steel Policy – first of its kind – to boost investment in the steel sector of the country. Ministry officials have already prepared a draft Steel policy which has been sent to all relevant ministries including the Federal Board of Revenue.

The draft policy offers several incentives for those steel manufacturers who plan to make a minimum investment of up to $350 million. The Policy will allow investors to raise the funds with the help of Foreign Direct Investment, Joint Venture, and consortium or even be locally produced.

The policy seeks to raise the investment in Steel Sector under both Greenfield and Brownfield mode of investments. However, in order to make investments in both forms, the company must abide by certain conditions.

Under the draft policy, it has been mandatory for those willing to acquire Greenfield status to at least install production capacity at one million tons of steel per annum. On the other hand, brownfield investors, those willing to resume production on defunct plants, will have to work above the ceiling of 500,000 tons per annum.

The policy also proposed those companies willing to invest under the new drafted policy to be eligible for exemption of taxes in the steel sector. The policy will be put into effect after the final approval from Federal Board of Revenue (FBR).

The policy is in the works keeping in view the strong local demand in the country owing to the ongoing infrastructure projects under China Pakistan Economic Corridor among others.