According to Mr Virbhadra Singh steel minister, Indian steel Industry has shown a remarkable degree of resilience from its inherent strength of cost competitiveness and also due to the stimulus measures announced in the last eight months. As a result it moved to third position in the world steel production, after China and Japan during the first 5 months of 2009.
Mr Singh said due to the various timely stimulus measures adopted by the Government, the steel industry in India came out of the shadows of the economic slowdown and recorded a growth of nearly 3% in January to March quarter of 2009, followed by 5.3 % increase in steel consumption and 3.4% growth in steel production, during Q1 of current financial year. This performance has put the steel sector of the country as one the best in the world. He was addressing the third Steel Summit organized by the ASSOCHAM today.
He said that Indian steel consumption will continue to grow at a pace varying between 6% to 8% during the current financial year, fully supported by the various fiscal, monetary and administrative measures being exercised by the government. He added that the massive expenditure proposed by the government for social and physical infrastructure growth augurs well for the steel sector also. Nearly INR 70,000 crore has been earmarked in this year’s budget on schemes such as JNURM, Pradhan Mantri Gram Sadak Yojana, Indira Awas Yojana etc. Increased allocation has also been earmarked for National Highways and Railways. These will not only result in growth in steel consumption but also will provide a stable market for steel, particularly TMT bars, structural steel and items of mass consumption.
Mr Singh said that the steel ministry is aware of the huge responsibility of this industry as a provider of a basic ingredient of economic and industrial development. The current slowdown and our commendable performance in the face of it has motivated us to introspect and identify areas of improvement needed to push the Indian steel industry on a high growth trajectory to support the country’s overriding objective of sustainable and inclusive growth. We have chalked out the action plan for the next 100 days with a focus on achieving the target of 124 million tonne of capacity by 2011-12 with special focus on the modernization and capacity expansion program in the leading steel PSUs. Apart from that we propose restructuring, reorganizing and amalgamating the PSUs for achieving economies of scale and vertical integration along with raw material security.
Mr PK Rastogi said steel secretary said the Indian steel industry has weathered the global downturn very well. He said production and consumption of steel has shown remarkable turn around. In the Q1 2009, production has gone up by 3.4% with June recording 5.3% growth over the corresponding month last year. During April to June 2009, consumption of steel has gone up by 5% over the corresponding period last year. He said, while imports fell sharply by 23% in June 2009 after a hefty rise of 21% in the month of May 2009. During the Q1 2009 imports have fallen by over 5% although the fall in exports has been much steeper at 37%.
Mr Rastogi said the sponge iron sector is facing problems with the supply of thermal coal. An alternate mechanism to address this issue is under the active consideration of the ministry. He said the Inter Ministerial Group is taking up the issues concerning infrastructure with the concerned state governments and other related departments and promised to take up other issues with concerned ministries whenever such issues are brought to the notice of the Steel Ministry
Wednesday, July 8, 2009
Mr Virbhadra Singh hails the resilience of the Indian Steel industry
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