Kolkata, May 28 : Government policies in long term perspective can help restore the confidence of the investors in the Indian steel industry, according to experts.
"Unfortunately, the government policies are focusing short term objectives, which is preventing investors of assured ROI," said Mr. Sushim Banerjee, Director General of INSDAG, at a chat session in the Metals Conclave 2019 organised by the Bengal Chamber here today.
Mr Banerjee said the scenario was not helping business sentiments in the industry and was the single reason behind declining private corporate investments in the last few years.
Private corporate investment can supplement public investment to raise indigenous steel production and drive demand for steel in the country, he said.
Mr. Partha Sengupta , President Operations of JSW Steel said Indian policymakers needed to unlock the demand potential of the 100 million population, which is just below the 100-120 million people "whose needs are met or close to met".
"The key lies in unlocking the demands of the next 100 million and enhance the buying power of these people,but without subsidies" he said.
According to Mr Banerjee, India's per capita income was much lower than other developing countries like Thailand, Indonesia and Malaysia, and a GDP growth of 8-10 per cent was required to boost steel consumption in the country.
Mr. Y P Singh Suri, MD and Country Head, Outokumpu (India) stated that government should look at quality of steel being produced as 60 percent of stainless steel in India was substandard with life of not more than 3-6 month.
"Stainless Steel protects environment and prevents losses due to corrosion. So standardization of quality, high-end manufacturing is needed,"he said.
Mr Banerjee said international standards were not being implemented by the SMEs in the steel industry, but the government couldn't immediately stop the production of non-standard steel as the Indian big players with quality output lacked manufacturing capacity to meet the demand.
"As much as 91 per cent of the market is captured by SMEs and big players like JSL and SALEM steel own only 9-10 per cent,"he said.
Mr Sengupta, however, said that several SMEs were producing high-quality steel. He said most SMEs had poor administration which was affecting the quality of steel produced.
As it is, India has also become the second largest producer of crude steel during 2018 besides being the largest producer of sponge iron in the world and the 3rd largest steel consumer in the world after China and USA. India envisages production of 300 million tonnes by 2030-31.
The steel demand from the infrastructure sector is expected to raise up to 138 MT in 2030, while steel demand from the automotive, engineering and transportation sectors is expected to triple by this
time period. India targets an increase in steel production capacity to 300 million tons by the year 2030-2031 and an increase in per capita steel consumption in the country from 69 kg per person to 160 kg per person. (UNI)