ISLAMABAD, June 12: An expansion plan was underway that would increase production capacity of Pakistan Steel Mills (PSM) to three million tons per year by 2012 from the existing one million tons per year.

Adviser to the prime minister on Industries and Production Mian Manzoor Ahmad Wattoo, who chaired a meeting here on Thursday, was told that by the end of current year the capacity would increase to 1.3 million tons per year from the current one million tons. Under the second phase of the expansion plan, by the end of 2010, the capacity will increase to 1.5 million tons. After the completion of third phase in 2012, the total capacity of PSM will reach 3 million tons.

Mr. Wattoo directed the Pakistan Steel Mills’ management to work out a comprehensive expansion plan and generate its own resources to finance this plan. He said that the expansion in capacity was required to make PSM more economic and financially viable and to meet the increasing demand of steel in the country.Secretary Industries and Production Shahab Khawaja and PSM Chairman Moeen Aftab Sheikh also attended the meeting.

The adviser, who was given a detailed briefing on the overall working and structure of the PSM, instructed the management to increase its dependence on the local raw material in its expansion plans and routine operations.

He further said that there were many iron ore and coal reserves in different parts of the country, which should be utilised to save the foreign exchange and decrease dependence on imported raw material.

Mr Wattoo also chaired a briefing on Pakistan Stone Development Company (PASDEC). Its chairman Ehsanullah Khan gave a detailed briefing on various projects of the company.

He said that the PASDEC was working on 43 different projects, which include development of marble cities, model quarries, up-gradation of existing quarries, common facility and training centres etc.

He informed the meting that one model quarry established by PASDEC has started working in Khuzdar (Balochistan) and two marble cities -- one at Risalpur and other in FATA -- are ready for ground breaking.

The chairman further said that the 120,000 direct and 500,000 indirect employment will be generated under various projects of PASDEC.

He also revealed that due to the efforts of company marble export from Pakistan had increased from $14 million last year to $23 million this year marking an increase of 43 per cent.

Mr Wattoo observed that Pakistan was rich in natural resources and marble and granite in abundance in different areas of the country.

“We need to do more to exploit these resources to the maximum,” he said, adding: “There is a large scope for development of mines in Balochistan”.

He also directed the PASDEC and officials of the ministry to explore the possibility of Italian investment in domestic marble and granite sector as Italy is much advanced in this field.