History
After the state establishment of State of Pakistan in 1947, the Government of Prime minister Lyakat Ali Khan, came to realized to a thinking mind-set that the goal of progressive industrialization nearly impossible without the possession of a self-reliant iron and steel foundry. Initially, the foreign dependence on imports caused serious economical setbacks to the state along with an extortionately high import bill which would be impossible to support. The initial idea and studies were conceived by the Council of Scientific and Industrial Research (PCSIR) and put forward the concept to the Five-Year Plans of Pakistan (1955-1960). In 1958, Soviet premier Nikolai Bulganin offered technical and scientific assistance to Prime minister Suhrawardy regarding the steel mills and expressing interests in establishing the country's first steel mills.
The project was comprehensively debated in the governments of Prime Minister Huseyn Suhravardie and President Ayub Khan; the manufacturing process, supply sources of the requisite machinery and raw materials, plant site, domestic ore versus imported ore, ownership pattern, product mix and all foreign financing credit kept the project on hold for a considerable time.
After 20 years of policy development and studies of PCSIR, President General Yahya Khan gave the approval of the recommendations of the state-owned scientific think tank, the Council of Scientific and Industrial Research. Bureaucrats and scientists agreed upon an unified decision that the "Karachi Steel Project" shall be sponsored in the state-public sector, under which a separate corporation sanctioned by the Companies Act, will be formed.
In pursuance of this decision, the Pakistan Steel Mills Corporation Limited (PSM Ltd.) was given commissioned and incorporated as a private limited company in a public sector in the accordance of Companies Act of 1913, to be established in Karachi, Sindh Province of Pakistan. Contacts were made to United States but the U.S. government showed lack of ambitions and interest in the project; therefore the studies were sent to Soviet Union who took the initiatives. The United States forcefully refused to provide or give any kind of assistance, as the creation of any such kind of basic industry in an underdeveloped country was considered a threat to their own exploitative imperialist agendas.
Finally, an agreement was reached with the V/O Tyaz Promexport of the Union of Soviet Socialist Republics (USSR) in January 1969. In 1971, Pakistan and Soviet Union finally proceeded to entered in a government agreement, upon which, the Soviet Union agreed to provide techno-financial assistance for the construction of a coastal based integrated steel mill at Karachi.
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