Russian experts estimate $1.9bn for Pakistan Steel Mills revival

Pakistan has renewed efforts to restore the Pakistan Steel Mills (PSM), which has been non-operational for nearly a decade, as a Russian technical team finalised its preliminary cost assessment for the plant’s rehabilitation or construction of a new facility.

According to official sources, the Russian experts have prepared cost estimates for two options — restoring the existing mill or setting up a new one equipped with modern electric arc furnaces. The assessment indicates that reviving the current mill would cost around $1.9 billion, while building a new plant would require $1 billion.

The Russian team noted that rehabilitating the old blast furnace system might appear costlier initially but would be a one-time expenditure. By contrast, a new plant would require importing all steel scrap, leading to higher recurring expenses.

Officials from the Ministry of Industries said that while the proposed new plant’s estimate seems lower, its dependence on imported raw materials could raise annual operating costs. They added that restoring the existing mill would allow greater use of locally produced iron, potentially offering long-term savings and supporting domestic industries.

Both options remain under review, with the government expected to decide based on technical viability and financial sustainability.