ISLAMABAD – For more than a decade Pakistan Steel Mills has stood largely unoperational while billions of rupees continued to flow from the government, and recent figures reveal that the state provided around Rs58 billion to the loss-making steel giant despite shutdown.
Production at PSM shut down in 2015, while the federal government keep pumping billions into state-owned steel giant over the last years. The startling figures were disclosed by the Ministry of Industries and Production in a written response submitted to the Senate following a question by Senator Talha Mahmood.
Official documents show that the government released around Rs38 billion in 2021 alone, making it by far the largest financial package provided to the mill during the period under review. The flow of public money continued in the following years. Pakistan Steel Mills received approximately Rs8 billion in 2022, around Rs2 billion in 2023, and nearly Rs3.25 billion in 2024. In 2025, another Rs820 million was released, according to government records.
The scale of the spending becomes more striking against the mill’s operational status. Pakistan Steel Mills remained effectively shut for around 11 years, with the government continuing to shoulder its financial obligations despite the absence of regular production. The funds have largely been used to meet liabilities linked to employees and former employees, including salaries, pensions and gratuity payments.
Documents reveal that approximately Rs12 billion was spent on salaries, while a further Rs15.25 billion was paid in gratuity. A big chunk of the taxpayer-funded support has gone towards keeping the organisation’s financial obligations covered rather than restoring steel production.
The contrast with the mill’s earlier financial performance is stark. Pakistan Steel Mills last reported a profit of approximately Rs9.5 billion in 2008. Since then, the industrial giant has gone through years of financial difficulties, operational disruption and uncertainty over its future. Now, instead of generating revenue for the country, the mill continues to require substantial government funding.
The government’s decision to remove Pakistan Steel Mills from the privatisation list has added another twist to the story. With Steel mill no longer included in the privatisation programme, questions remain over how the government plans to deal with its accumulated liabilities and whether the facility can eventually be revived as a functioning industrial enterprise.
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