Wirana Shipping is calling on the Pakistani government to implement uniform tax policies for scrap metal derived from ship recycling within the country and scrap imported from abroad. This appeal comes after several weeks of lobbying by local ship recyclers who are seeking to reform a tax framework that inadvertently incentivizes domestic steel mills to procure raw materials from international markets.
The current tax mechanism, outlined in the Federal Board of Revenue’s notification SRO 1245(I)/2026, reportedly creates an uneven playing field. By making imported scrap more financially attractive, it undermines the competitiveness of Pakistan's shipbreaking industry, which is a significant source of local scrap steel.
For freight forwarders and logistics professionals, this situation primarily affects the inbound flow of scrap metal into Pakistan. If the tax disparity persists, demand for imported scrap will likely remain robust, ensuring continued sea freight volumes for this commodity. However, if the tax treatment is equalized, it could reduce the volume of imported scrap, potentially impacting freight rates and capacity utilization for carriers serving this trade lane. Conversely, a stronger local ship recycling industry could lead to increased domestic logistics activity for scrap transport within Pakistan.
