Editorial – March 2024 :
I have always been making a point through this column that the India’s economic growth is backed by the infrastructure development and steel industry is in the center of the infrastructure development process. Thus if India’s economy (meaning GDP) has to grow for the next few years, it needs a strong support from iron & steel industry. This thought process makes us confident about the future of iron & steel industry in the country. Yes, the steel industry in India has a bright future on a long term basis bu this does not by any chance means that it is free of all the problems. Rather I would say, it has to overcome many hurdles, tackle many issues so as to ensure a smooth upward journey.
What are the issues presently facing the industry ? I can say that the first and foremost issue is that India does not have enough plant designing and building capacity. If we have to reach up to a capacity level of around 300 MTPA by 2030-31, we have to naturally augment our capacity. How many companies are there in the country which can design and build a steel plant ? I would say only a handful of them. The second issue in the priority list is lack of technically qualified manpower. Are we aware that very few engineering colleges in India offer metallurgy stream and very few metallurgists remain in metallurgical profession after passing out. They are ‘snatched away’ by the industries offering better packages and better work environment. Seeing all this, many engineering colleges have either stopped offering metallurgy stream or integrated it in the Material science stream. What are we as an industry doing about it ? Steel industry, being a core and very important industry for the economic growth of the country, has got a separate ministry. Why this ministry can not look into such basic and fundamental issues which will surely hurt the industry and also the economy in the long run ?
Now let us discuss about the international situation. We know that the Eurozone is stagnated for the last few years and India’s steel exports to this region have decreased over the years. Also the Russia – Ukraine war as well as the proposed CBAM post 2026 has further deteriorated the situation and thus I don’t see much growth in India’s exports to Eurozone. MENA region was another big export destination for us but given the fluid and war like situation in many countries in the region, it may not be advisable to depend on this region for the exports. For SE Asian countries, we have a big competitor like China and Africa is yet to awake fully.
Given such a situation in the global marketplace, in my opinion the best strategy is to look inward. India is the biggest emerging market in the world. Our rural markets have tremendous untapped potential. Develop products suitable and useful for rural life. There lies the future !