ISA’s recommendations for
National Steel Policy
September 27, 2004 : Indian Steel Alliance today said
that for the domestic steel industry to achieve its production target of 60 MnT by
2010-12, it is imperative that the entrepreneurs and investors remain confident about the
future growth story of the Indian steel industry. The alliance hopes that the while
drafting the National Steel Policy, the government will consider the following :
• Indian steel industry should be allowed to have a fair return on
investment so that it can remain attractive for investors. The steel industry has already
invested a capital of over Rs. 90,000 crores and would require an additional investment of
Rs. 75,000 crore for capacity expansions. The government, through consistent policies
should look at building investor confidence in the steel sector.
• ISA recommends that to be able to increase the per capita
consumption of steel in the country, the government must extend the current thrust on
infrastructure development to rural India. Rural India presents a great challenge to the
steel manufacturers to promote steel consumption through projects like rural housing,
irrigation and agriculture.
• Government should ensure that quality raw material such as
iron-ore and coke are available to the industry. There should be a consistent policy for
iron ore exports that gives priority to the domestic industry. Given the ambitious
production targets set by the Ministry of Steel, there is an urgent need to develop raw
material resources for inputs like iron-ore and coal within or outside the country.
• Adequate infrastructure such as power, ports, roads, rail
transport that supports the development of the steel industry should be made available.
This will also add to the competitiveness of the Indian steel industry.
• Today, the Indian steel industry is among the least protected
industries in the world and is exposed to cheaper imports from competing nations. The
government should give reasonable amount of protection to the domestic steel industry in
the form of import duties like done by other developed countries.
• In a globalized market oriented economy, market forces should be
allowed to ensure price corrections and determine optimum level of prices. By encouraging
competition and ensuring larger supplies, the market will be equipped to protect the
consumers.
• While the steel industry continues to serve the domestic demand,
there is still a lot of untapped export potential. Indian manufactured steel is accepted
globally but its share in the world steel is a minuscule 2%. The government in line with
EXIM policy 2002-07 should take steps to make Indian exports more competitive. |
