The Indian Iron and
Steel Industry, during the year 2002, has started emerging out
of the shadows of a long-haul downswing. With emerging buoyancy
in the steel market, both public and private sector units have
started increasing their profits.
Steel Authority of
India (SAIL), during this year, has geared up to achieve all-time
best production levels at the end of the current fiscal and to
turn corners with a cash profit. It has recorded a growth of 42
per cent in the production of rails, 11 per cent in merchant products
and 5 per cent in wire products during April-November 2002. The
Steel Minister reviewed the implementation of physical and financial
restructuring of SAIL during June, August and October 2002. The
Company has launched a Voluntary Retirement Scheme envisaging
lump-sum payment during the year to separate more employees.
Vishakhapatanam Steel
Plant (VSP) another public sector unit, during this period, has
achieved a record sales turnover of Rs. 2773 crore and earned
a profit of more than Rs. 147 crore. In many fields the Plant
has shown an excellent performance and hopes to turn around at
the end of this fiscal. It received this year an award for its
best efforts in rain water harvesting instituted by Andhra Pradesh
Pollution Control Board. Manganese Ore (India) Limited (MOIL),
the single largest producer of high grade manganese ore in the
country achieved a sales turnover of Rs. 158.19 crore during January-November
2002 and earned net profit of Rs. 17.14 crore.
National Mineral
Development Corporation (NMDC) another public sector undertaking
of the Ministry earned a net profit of Rs. 239.5 crore during
April-November 2002 against a target of Rs. 231 crore. It produced
99.56 lakh tonnes of iron ore and 48554 carrots of diamond during
this period achieving 97 and 89 per cent of the target respectively,
and sold nearly 116 lakh tonnes of iron ore and 34983 carrots
of diamond. It ranked among top ten public sector enterprises
of the country.
Metal Scrap Trading
Corporation and its subsidiary Ferro Scrap Nigam Limited have
also earned more profit during the year. Kudremukh Iron Ore Company
Limited (KIOCL) according to a Supreme Court judgement got extension
of mining lease till December,2005. The company is taking further
action in the matter. It earned a net profit of 57.40 crore during
April-November 2002. TISCO and other private sector plants have
also substantially increased their profits. All these augur well
beginning of an upswing for this industry.
The total production
of finished steel during January-November, 2002 has been provisionally
estimated at 28.79 million tonnes as against 26.63 million tonnes
during January-November, 2001 showing increase of about 8.1 per
cent. Pig iron production during this period was about 4.27 million
tonnes as against 3.63 million tonnes during the same period last
year showing an increase of 17.6 per cent. The availability of
finished steel during January-November, 2002 has been 25.45 million
tonnes as compared to the figures of 23.16 million tonnes for
the same period last year showing an increase of 9.8 per cent.
The apparent consumption of finished steel during the year has
been 25.30 million tonnes against 23.27 million tonnes during
the last year recording an increase of 8.72 per cent. The industry
has been successful in diversifying the export distributions to
new areas in Asia, Africa and Middle East. It has been able to
cash in on Asian resurgence and other South East Asian economies.
During the period
many countries imposed trade barriers and US embargo was a big
blow to the industry. Government of India at its own level and
in collaboration with the affected parties approached the US
Commerce Department
for a possible re-look into the case. During the year the steel
prices across the board have gone up right from intermediaries
to finished products and the International prices have firmed
up. These have contributed to make Indian exports more viable.
Net sales realisations which were on severe pressure till the
beginning of the year have improved significantly. With all these,
steel sector is poised to register a growth of 6 per cent during
the current fiscal.
The Ministry has
set up a National Steel Institute at Puri to train people and
provide consultancy services. It now offers courses like development
of welding technology, steel making technology and computer courses.
Its main activities will be research and development and consultancy
in techno-economics. The Steel Ministry has decided to formulate
the National Steel Policy for drawing up a road map for this sector
in context of second generation reforms, restructuring and globalisation.
A Committee under the chairmanship of Development Commissioner
for Iron & Steel, Kolkata has prepared the first draft of
the policy, which is being examined in consultation with the steel
producers and associations.
The Ministry has
started awareness campaign in the rural areas to use more steel
items to increase the consumption of steel in the country. In
collaboration with the Ministry of food and its Save Grain campaign
the steel industry has provided subsidised steel storage bins
and silos to the farmers in different states to popularise use
of steel. Many plants have diversified their products and have
gone for value added items. Stainless steel is being used in roofing
the platforms of railways, putting barricades in the rivers and
tanks and other major construction works. The Ministry, during
the year emphasised on consumption, as average annual consumption
of steel in India varies between 25-30 kg against world average
of about 120 kg.
During the year the
Government have approved the revival packages for Bharat Refractories
Ltd; (BRL) and Indian Iron and Steel Companies Ltd; (IISCO) and
is trying to implement them effectively. The comprehensive rehabilitation
package for BRL,Bokaro, contains assistance for implementing VRS,
payment of outstanding statutory dues, guarantee for working capital
loans and investment for annual maintenance repair. The package
aims at improving its productivity, cut costs and achieve higher
capacity utilisation.
In June 2002, Government
approved a revival package for IISCO which includes grants for
financing VRS in Kulti Works, which is to be closed down, besides
provision of Government guarantees to raise money for financing
VRS in Burnpur Works and mines & collieries. This package
also includes provision for capital investments at Burnpur Works
and Mines & Collieries of IISCO with the facility of interest
subsidy. Steel Development Fund (SDF) loan of Rs. 44.68 crore
advanced to IISCO and JPC dues of Rs. 18.49 crore have been waived.
According to the directions of BIFR, SAIL has submitted the rehabilitation
proposal for IISCO to IDBI the Operating Agency for BIFR in July
2002. The funds amounting to Rs. 186 crore have already been released
to SAIL for implementation of VRS in Kulti Works of IISCO.
