russia has struck a major business deal with pakistan amid the ongoing tensions between india and Pakistan. This billion-dollar agreement calls for the construction of a state-of-the-art steel factory in Karachi.
The goal of this agreement is to reopen the pakistan Steel Mills (PSM), which were constructed by the Soviet Union and have been shut down since 2015. This agreement, which is expected to cost $ 2.6 billion (approximately 22,000 crore rupees), may be crucial for bolstering Pakistan's economy.
What is the Agreement?
Russia and pakistan have reached an agreement to reopen the shuttered steel facility in Karachi. The Soviet Union played a role in establishing this factory in the 1970s. It continued to operate until 1992, but for technical and financial reasons, it was finally shut down in 2015. Pakistan is anticipated to become up to 30% less dependent on steel imports as a result of the new agreement, which calls for russia to supply sophisticated steel manufacturing technology—that is, equipment with the most cutting-edge technology for steel production.
Reducing Pakistan's 11.2 million metric tons of steel consumption shortfall is the project's goal. The cost of imported semi-finished goods and scrap was $324 million in march 2025. In addition to lowering import costs, this project will create more jobs locally.
How will pakistan Benefit?
Pakistan's economy will benefit from this agreement. For pakistan, which is now experiencing an economic crisis, a 30% cut in steel imports will ease the strain on foreign exchange reserves. Thousands of direct and indirect work possibilities will be created by the steel plant's rebirth. Economic activity in Karachi and the neighboring areas will increase as a result. Utilizing Russia's cutting-edge steel production technologies would help Pakistan's steel sector become more competitive and contemporary. Local production will become more efficient and of higher quality as a result. Long-term economic stability depends on increased self-sufficiency brought about by a decreased reliance on imported scrap and semi-finished goods.
A Matter of concern for India?
India is concerned about this agreement because it was made during a time of tension between india and Pakistan. After 26 people were killed in a terrorist assault in Pahalgam, kashmir - SRINAGAR/JAMMU' target='_blank' title='jammu and kashmir-Latest Updates, Photos, Videos are a click away, CLICK NOW'>jammu and kashmir, on april 22, tensions between india and pakistan are at an all-time high. india responded by carrying out Operation Sindoor, which involved airstrikes on terrorist bases in Pakistan.
Russia has long viewed india as a strategic ally, but this time it has responded in an impartial and well-rounded manner. While denouncing the attack, Russian President Vladimir Putin offered mediation and urged india and pakistan to reduce tensions. Given that russia has previously publicly backed india on the kashmir problem, this position was surprising for India.
In recent years, ties between pakistan and russia have improved.
The goal of this agreement is to reopen the pakistan Steel Mills (PSM), which were constructed by the Soviet Union and have been shut down since 2015. This agreement, which is expected to cost $ 2.6 billion (approximately 22,000 crore rupees), may be crucial for bolstering Pakistan's economy.
What is the Agreement?
Russia and pakistan have reached an agreement to reopen the shuttered steel facility in Karachi. The Soviet Union played a role in establishing this factory in the 1970s. It continued to operate until 1992, but for technical and financial reasons, it was finally shut down in 2015. Pakistan is anticipated to become up to 30% less dependent on steel imports as a result of the new agreement, which calls for russia to supply sophisticated steel manufacturing technology—that is, equipment with the most cutting-edge technology for steel production.
Reducing Pakistan's 11.2 million metric tons of steel consumption shortfall is the project's goal. The cost of imported semi-finished goods and scrap was $324 million in march 2025. In addition to lowering import costs, this project will create more jobs locally.
How will pakistan Benefit?
Pakistan's economy will benefit from this agreement. For pakistan, which is now experiencing an economic crisis, a 30% cut in steel imports will ease the strain on foreign exchange reserves. Thousands of direct and indirect work possibilities will be created by the steel plant's rebirth. Economic activity in Karachi and the neighboring areas will increase as a result. Utilizing Russia's cutting-edge steel production technologies would help Pakistan's steel sector become more competitive and contemporary. Local production will become more efficient and of higher quality as a result. Long-term economic stability depends on increased self-sufficiency brought about by a decreased reliance on imported scrap and semi-finished goods.
A Matter of concern for India?
India is concerned about this agreement because it was made during a time of tension between india and Pakistan. After 26 people were killed in a terrorist assault in Pahalgam, kashmir - SRINAGAR/JAMMU' target='_blank' title='jammu and kashmir-Latest Updates, Photos, Videos are a click away, CLICK NOW'>jammu and kashmir, on april 22, tensions between india and pakistan are at an all-time high. india responded by carrying out Operation Sindoor, which involved airstrikes on terrorist bases in Pakistan.
Russia has long viewed india as a strategic ally, but this time it has responded in an impartial and well-rounded manner. While denouncing the attack, Russian President Vladimir Putin offered mediation and urged india and pakistan to reduce tensions. Given that russia has previously publicly backed india on the kashmir problem, this position was surprising for India.
In recent years, ties between pakistan and russia have improved.
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