Islamabad/Moscow, July 12, 2025 – Pakistan and Russia have signed a protocol agreement to restore and modernize the defunct Pakistan Steel Mills (PSM) in Karachi, originally built in the 1970s with Soviet support. The pact - signed at the Pakistan Embassy in Moscow by Industries Secretary Saif Anjum and Russia’s Vadim Velichko of Industrial Engineering LLC - aims to restart steel production, expand capacity, and relaunch a strategic industrial partnership.

PSM ceased operations in 2015, and in 2024 Pakistan formally closed it. The Sindh provincial government then sought international partners to revitalize the aging mill, sparking a collaborative race between Russia and China. Islamabad has now opted for the Russian bid, citing shared history and technological continuity. The agreement covers not only refurbishment of existing infrastructure, but also exploratory plans for new steel plants on the mill premises. 

Officials emphasize that revival efforts will boost local production, reduce reliance on steel imports, and stimulate regional growth. In 2024, loose steel imports flooded Pakistan’s markets, prompting renewed urgency. Economists note that reactivating PSM could save hundreds of millions of dollars by cutting import dependence and generating employment. A technical working group will now evaluate site feasibility and oversee environmental and financial planning.