Editorial – December 2023 :
The economic growth of any region has a strong co-relation with the geo politics and so the iron & steel The sector is also dependent on the international situation.
Today, the uncertainty in the world is increasing. We thought the Ukraine – Russia war will get over in few weeks but even after more than a year, it is still continuing. This has not only affected international trade of Russia and Ukraine but has also damaged few shipping routes. The clash between Hamas and Isreal. started in early October. Everybody thought is is a question of just few days for Isreal and also the problem is small and localised. Now almost four months are over and the problem is far from over. More and more groups and countries are getting involved in this issue, directly or indirectly, and now its seems that the whole middle east region is affected by this issue. We all know that conventionally the MENA region is a big importer of steel from Turkey, China, CIS etc. But now the future of this trade remains hung due to war like situation in the region. Also going down of China’s GDP growth rate has affected its international trade.
All the above factors have contributed to induce fluidity in the global geo-political situation and has naturally affected the industry and mainly the international trade. Thie ie where one can understand the rising importance of India. To understand the situation in India better, we have to take into consideration two important points. Firstly, India is a consumption driven economy and secondly, it has a very little international trade component. Though in normal situations this would have been considered as a negative point, in stressful situations like today, this becomes a positive point. Also our huge population, may be a negative point otherwise, certainly pushes the consumption up. Most countries in the world are fearing a recession due to the disturbances mentioned above but the sentiment in India is totally different. We are expecting a robust economic growth in coming years which surely translate in to a big steel demand. No wonder in the chart of Countries facing recession probability India rightfully assumes the last position.
Friends, this does not mean that the iron & steel industry in India is free from all the problems and challenges. The future road is going to be corrugated and with stiff competition. Only the best is going to survive. On one hand it has a lot of opportunities and on the other, a lot of challenges. Only few steel plants are going on the path of digitalization, green steelmaking remains a big challenge facing the industry, re-cycling is not being practised to the extent it should. A lot of unsolved problems. With all this, I would say that we will have a very challenging yet exciting and interesting journey ahead.
Welcome to FUTURE !