Recently, the Indian steel industry has expressed concern over India becoming a net importer of steel in 2023-24.
About the Steel Sector
Steel has traditionally occupied a top spot among metals.
Steel production and consumption are frequently seen as measures of a country’s economic development because it is both a raw material and an intermediary product.
The Indian steel industry is classified into three categories – major producers, main producers, and secondary producers.
India has set a target of having an installed steel manufacturing capacity of 300 MT by 2030.
Importance
The steel sector plays a pivotal role in crucial sectors such as construction, infrastructure, automobile, engineering, and defense.
Over the years, the steel sector has witnessed tremendous growth and India has emerged as a global force in steel production and the 2nd largest producer of steel in the world.
The growth in the Indian steel sector has been driven by the domestic availability of raw materials such as iron ore and cost-effective labour.
The Indian steel industry is modern, with state-of-the-art steel mills.
It has always strived for continuous modernization of older plants and up-gradation to higher energy efficiency levels.
Consequently, the steel sector has been a major contributor to India’s manufacturing output.
Related Steps
The Union Cabinet gave its approval for National Steel Policy (NSP) 2017 which enshrines the long-term vision of the Government to give impetus to the steel sector.
It seeks to enhance domestic steel consumption ensure high-quality steel production and create a technologically advanced and globally competitive steel industry.
In October 2021, the government announced guidelines for the approved specialty steel production-linked incentive (PLI) scheme.
FDI: The Government has allowed 100% FDI through an automatic route for the steel sector in India.
Concerns
Low investment in technology and Infrastructure
Raw material availability is the key challenge for the steel industry.
India has registered a 38% surge in imports of finished steel to 8.319 million tonnes (MnT) over 6.022 MnT imported during the preceding 2022-23 fiscal.
The surge in predatory imports from China is a big threat to the Atma Nirbharta in steel.
health and safety are the most neglected concerns in the Indian steel sector.
Steel production is an energy-intensive process that has a significant environmental impact.
Conclusion and Way Forward
The steel industry has emerged as a major focus area given the dependence of a diverse range of sectors on its output as India works to become a manufacturing powerhouse through policy initiatives like Make in India.
There is a need to ensure a sustainable supply of crucial raw materials, such as iron ore and coking coal, along with enhancing export competitiveness that will be vital for achieving this ambitious goal.
India’s steel industry faces threat from predatory imports.
Restricting steel imports is crucial to safeguard investments and ensure robust GDP growth.
aIt becomes imperative for the industry to strategize ways to enhance the cost competitiveness of products.
