The Nation reported that Pakistan’s steel industry fears shortage of steel in the country coupled with an increase in the cost of steel as the industry is facing acute difficulties in import of raw material due to problems being faced in opening up of the LCs. Pakistan Association of Large Steel Producers has demanded urgent measures from Pakistan Government for addressing the issue of delay in opening of LCs for steel imports. The PALSP has urged the State Bank of Pakistan Governor and Minister for Finance to help the troubled industry by ensuring timely opening of LCs. There is a dollar crisis in the banks over the country. The importers are unable to open letters of credit due to lack of dollar and are not able to import goods from different destinations. Banks are also hesitant to open LCs for the import of raw materials and delay in LC opening and approvals from SBP are also witnessed. The production activities are badly suffering due to delay in opening of LCs and at the same time, long queues of importers are seen to get permission to open LCs while banks are facing a low inflow of dollars. The ongoing situation has created serious problems for the industry due to the shortage of raw material for their manufacturing activities. Due to non-release of import documents and consequent non-availability of raw material, many steel mills are on the verge of closure. Some have already cut their productions drastically. The steel industry heavily relies on imported raw material. So, the curbs on the opening of letters of credit have significantly affected the production activities. Due to delays by SBP in LC’s approval, continuous rupee depreciation, and uncertainty in market the manufacturers are facing disruptions in industrial production, unbearable demurrages and container charges, loss-making delays in fulfillment of orders. All of this will result in inflationary pressures in the domestic markets and further discouraging investor sentiment. During the first 4 months July 22 to Oct 22 of the current financial year, Pakistan’s scrap imports have decreased by 41% YoY to 890,783 tonnes
The Nation reported that Pakistan’s steel industry fears shortage of steel in the country coupled with an increase in the cost of steel as the industry is facing acute difficulties in import of raw material due to problems being faced in opening up of the LCs. Pakistan Association of Large Steel Producers has demanded urgent measures from Pakistan Government for addressing the issue of delay in opening of LCs for steel imports. The PALSP has urged the State Bank of Pakistan Governor and Minister for Finance to help the troubled industry by ensuring timely opening of LCs. There is a dollar crisis in the banks over the country. The importers are unable to open letters of credit due to lack of dollar and are not able to import goods from different destinations. Banks are also hesitant to open LCs for the import of raw materials and delay in LC opening and approvals from SBP are also witnessed. The production activities are badly suffering due to delay in opening of LCs and at the same time, long queues of importers are seen to get permission to open LCs while banks are facing a low inflow of dollars. The ongoing situation has created serious problems for the industry due to the shortage of raw material for their manufacturing activities. Due to non-release of import documents and consequent non-availability of raw material, many steel mills are on the verge of closure. Some have already cut their productions drastically. The steel industry heavily relies on imported raw material. So, the curbs on the opening of letters of credit have significantly affected the production activities. Due to delays by SBP in LC’s approval, continuous rupee depreciation, and uncertainty in market the manufacturers are facing disruptions in industrial production, unbearable demurrages and container charges, loss-making delays in fulfillment of orders. All of this will result in inflationary pressures in the domestic markets and further discouraging investor sentiment. During the first 4 months July 22 to Oct 22 of the current financial year, Pakistan’s scrap imports have decreased by 41% YoY to 890,783 tonnes
