ISLAMABAD: Pakistan is losing the profit game in the global market due to the export of raw materials used in the manufacture of iron and steel. Chromium, silicon, nickle, manganese, iron ore, chromite, among others, are the raw materials found in abundance in Pakistan.
Assistant Director of Geological Survey of Pakistan Yasir Shaheen Khalil shared these views with WealthPK in a discussion about production of iron and steel.
The discussion pertained to the countries that had banned the export of raw materials and only exported the steel manufactured by their local units.
Yasir said Pakistan was blessed with a variety of minerals in considerable quantities and grades. For example, iron ore of 25% to 65% grade and chromite of more than 50% grade (which can be enhanced up to 99% after dispensation) is found in Pakistan. He said these minerals should be exported or sold after processing.
“The country is facing huge financial losses in this situation, as other countries buy the raw material from us at too cheap rates and process it in many useful forms. Pakistan rebuys these processed materials in the form of steelor iron due to which a lot of foreign exchange is lost,’’ he said.
Yasir said Pakistan imported $4.59 billion worth of iron ore and scrap in the year 2021 to feed its steel industry. After petroleum and agricultural products, it seemed to be the largest import of Pakistan, he added.
Pakistan can take a leaf out of Indonesia’s book by utilizing its indigenous mineral resources, especially chromite and iron ore, to become a leading stainless-steel exporting country rather than depending on imports.
Indonesia banned the export of its mineral wealth in 2014 and emphasized its processing domestically. This step resulted positively and Indonesia exported iron and steel worth $20.95 million during the year 2021. By controlling its mineral resources and incentivizing the processing facilities and investors, Indonesia is earning handsome foreign exchange and its mineral industry is also getting stronger.
In the same year, iron and steel accounted for about 9.2% of its total exports. According to Indonesian Coordinating Minister of Economic affairs Mr. Airlangga, the approximate value gain of about US$20.8 from iron and steel exports was a huge leap, which was the result of banning the export of raw material, as it would only be worth $1 to $2 billion.
Pakistan badly needs strict decisions and reframing of official policies to uplift its steel industry. Like agriculture, the mining sector is also an important segment related to the sustainable livelihood of many people. Its development will bring a great change in the remote and developing areas of the country.
Along with the local processing of mined raw materials, processing units must also be engineered in Pakistan according to the type of its own sources. This will not only boost industrial tools manufacturing but also create job opportunities for a great number of people.
