February 19, 2002
‘18’
SAIL ASKED TO COMBAT ADVERSITIES AND ACHIEVE GROWTH
CONSULTATIVE COMMITTEE OF STEEL MINISTRY MEETS
The members of the Consultative Committee attached to the Steel Ministry have asked the Steel Authority of India Ltd. (SAIL) to plan strategies to achieve growth in the face of all the adversities faced, at present, by the steel sector. Addressing the Committee members today the Minister for Steel Shri Braja Kishore Tripathy said that Steel Industry is passing through a difficult period. Sluggish domestic demand, import restrictions by USA, Canada and European Union, cheap imports and rising cost of input materials have affected financial and physical performance of the steel sector. Global slowdown, excess supplies, market swings and falling margins have made the situation worse. The Minister urged SAIL, the giant public sector undertaking of the Ministry to rise to the occasion and face the challenges ahead.The Minister said that despite all the odds SAIL has successfully managed operations, honoured its commitments to employees and financial institutions. Its cost saving drive has added to its earnings. The modernized facilities are yielding products rated best in the world. Downsizing of manpower and better process management has improved productivity. A restructured marketing strategy has achieved volume growth in a stagnant market. But it is a fact that it has incurred a loss of Rs.1720 crore in 1999-2000. To help SAIL, the Government came out with the Financial and Business restructuring package that has helped the PSU to reduce its losses to RS.729 crore in 2000-01. The net loss during the first 9 months of 2001-02 is nearly Rs.1290 crore, which is alarming. But it should be viewed in the context that the total loss suffered by the Steel Industry in the country during this period is approximately Rs.3000 crore.
The Minister said that the decline in the profits of SAIL is due to general slowdown in the economy, slow growth in consumption rate, increase in input costs and fall in international prices of steel products. The current prices of some of the steel products are almost half of the prices prevailing 6-7 years ago. The anti-dumping duties imposed by some importing counties is as high as 85 per cent.
The Members of the Committee strongly argued for reduction of excise duties and increase in customs duties on steel in the coming budget. They expressed concerned over the problems faced by the employees of Indian Iron & Steel Company Ltd. (IISCO) and Hindustan Steel Company Ltd. (HSCL) and appealed to the Minister to take steps for their revival. Shri Tripathy, in his reply mentioned that a revival package for IISCO has been planned and a joint venture with a Russian Company is under process. The Government has taken up the case of HSCL with the Finance Ministry.
The following members of the Parliament were present:-
Shri Sunil Khan, Shri K.Yerrennaidu, Smt. Hema Gamang, Shri A.Venkatesh Naik, Shri Lal Muni Chaubey, Shri Manjaylal, Shri Jibon Roy and Shri Gaya Singh.