PLANS TO UPGRADE STEEL INDUSTRY

New Delhi, 29 September 2006

NEW DELHI, September 30 (INFA): The Union Steel Ministry has taken several steps to expand and modernize the steel industry in the country.  It has set a target for production of 110 million metric tonnes by 2019-20, as envisaged by the National Steel Policy (NSA).

In an effort to mobililize resources for the required expansion of the industry and its technological upgradation, the Ministry is taking steps to encourage foreign direct investment.

Efforts are also afoot to contain price volatility is the steel market. Also, steps are being taken to create manufacturing capability for special types of steel and constitute coking coal.

In view of the buoyancy in the steel market in the last three years, entrepreneurs, both international and domestic, have expressed deep interest in the growth prospects of the Indian steel industry. In three mineral-rich States of Orissa, Chhattisgarh and Jharkhand, 116 memorandums of understanding (MoUs) have been signed by the State Governments covering a proposed capacity of 146 million metric tonnes per annum of additional capacity with an investment of over Rs.3.50 lakh crore.

Immediately after the announcement of the NSP, consultations were held with different sectors of the industry and the concerned State Governments, inviting feedback on formulating sector-specific action plans. The policy has generated substantial interest in different sectors.  Hectic consultations are going on with the State Governments for ascertaining the requirement of raw materials and infrastructure for the proposed growth plan in different States. The Ministry proposes to function as a nodal point for monitoring the progress made in the upcoming and proposed steel projects. 

On the issue of raw materials, mainly iron-ore for the steel sector, the Ministry constituted a high-level committee under the Member (Industry), Planning Commission.  It was tasked to review the National Mineral Policy and to recommend possible Amendments to the Mines and Mineral Development and Regulation Act, 1957. 

The Committee had extensive consultations with various interest groups, stakeholders and State Governments.  Reports prepared and submitted by Study Groups and in-house committees set up by various Ministries from time to time on the issues before the Committee were also discussed.

The Committee has since submitted its report and the matter is presently being examined by the Government.  However, since positive action flowing from the recommendations of the Committee may take some time.  The Ministry is also engaged in the preparation of an appropriate action plan for meeting the country’s raw material requirement.

A long-term action plan for promoting consumption of steel has been drafted and comments of different stakeholders are presently being obtained.  Efforts have also been made to amend the CPWD code for promoting steel-intensive design for construction.

To strengthen the distribution network of steel companies, the Government has also instructed the public sector units of the Steel Authority of India (SAIL) and the Rashtriya Ispat Nigam Limited (RINL) at Vizag to appoint district and sub-district level dealers covering the entire country.  So far, the SAIL has appointed 200 dealers in 07 districts. RINL has 40 dealers in 40 districts.  In addition, 300 plus dealers are to be appointed by SAIL in the near future. ---INFA