EMERGING CHALLENGES FOR THE INDIAN

STEEL INDUSTRY

By Mukesh Kumar
Mecon Limited

DEMAND PROSPECTS
Projections of working
group for 12th FY plan
(2016(2016-17)

Finished
Steel
(115.3 mt)
Crude
Steel
(128.1 mt)

Carbon Steel (108.3

mt)
Alloy Steel(5 mt)
Net Exports(2 mt)

Crude Steel (128.1

mt)
Crude Steel
capacity
(142.3 mt)

Projections till (2019(2019-20)

Finished steel
(152.3 mt)
Carbon Steel (145.3 mt)
Alloy Steel (5.0 mt)
Net Exports (2 mt)

Crude Steel (169.2

mt)
Crude Steel
Capacity (188.0 mt)

PROJECTIONS ARE FURTHER BACKED BY

Huge
infrastructural
investment
($1 trillion)

Thrust over
manufacturing
sector
(New
manufacturing
policy)

Governments
flagship
programmes
like Pradhan
mantri gram
sadak yojana,
indira awas
yojana etc

Need to lower
the
cement/steel
ratio in
construction
activity

Rapid
Urbanization

STRATEGIES TO ENHANCE STEEL CONSUMPTION

Steel
Consumption

Untapped Rural
market

Low purchasing
power
Faster
implementation of
social welfare
schemes

Overseas market

Poor infrastructural
linkages

Strengthening the
distribution
network

Poor distribution
network

By rapid execution
of rural
infrastructural
projects

Identification and
required product
specifications
therein

RAW MATERIAL ISSUES

Indigenous raw materials reserves

Raw materials

Reserves (in billion

Global Position

tonnes)

Coal :

Iron ore

28.5

5th

Coal

248

4th

Chromium

57

3rd

Manganese

160

2nd

Coking coal
Imports

Non-coking coal
for coal based
DRI plants

Pricing issues

Iron Ore:
Ferro Alloys :

Exports

Price volatility

Illegal Mining

Steady Power
Supply at a stable
price

MEASURES PROPOSED
Iron ore

Fiscal measures for Iron ore

export regulation
Underground mining for
environmentally sensitive
regions
Beneficiation, Pelletisation and
sintering technology

Coal

Other
issues

Coal washeries upup-gradation

& fresh installation
Exploration for expanding
resource base (Domestic as
well as overseas)

Captive power plants for Ferro

alloy industry
Checking mine theft
Mine related infrastructure

ENVIRONMENTAL ISSUES

ECONOMY
ENVIRONMENT

Projected steel sectoral emissions : 450 mt by 2020

SUGGESTIONS
Sustainability

Corporate
responsibility
for
environment
EMS
(ISO:14001)

Green
technologies
Land use
optimization
(carrying
capacity
study)

Fiscal
incentives
Compliance
with
statutory
provisions
Green economy

LAND ACQUISITION ISSUES

Capital

Labour

LAND?
Land auction for
Transparent
land price
determination

Trust deficit
Pricing issues
Multiplicity of stakeholders
involved
Delay in payment
Incompatible R&R with land
acquisition

Faster R&R
execution

Integrating R&R
with Land
acquisition

Minimizing no.
of stakeholders
involved

TECHNOLOGICAL ISSUES
Current technological profile...
BFBF-BOF

DRIDRI-EAF

45%
45% of the
total
Low
Low energy
consumption
Specific
Specific CO2
emission
(1800 kg/tcs)

24%
24% of the
total
Lowest
Lowest
energy
consumption
Specific CO2
emission
(360 kg/tcs)

Raw
material

DRIDRI-EIF
31%
31% of the
total steel
production
High
High energy
consumption

Beneficiation,
Beneficiation,
Pelletisation &
Sintering for lron ore

ITmk3, SCOPE21
etc

Technological
Technological
development for
Slime & HQR

NEW PROMISING TECHNOLOGIES

SCOPE21
FINEX

FASMELT

ITmk3

COREX

HISMELT
New
Promising
technologies

etc

Cost effective, Energy efficient and Environment friendly

SUSTAINABLE & INCLUSIVE GROWTH

Technology

R&D

?
What ?
and
How??

R&D
Focus over

Fact sheet...

Current R&D
expenditure : 0.15-0.25%
of sales turnover

Re-use of industrial waste like slag etc

Low carbon technology and energy optimization

Product diversification (special grade steel)

Conversion of non-coking coal variety to coking
coal etc

Government initiatives...
Industry

Steel development fund

Steel innovative council
under MoS

New National steel policy
for the forthcoming 30 yr

Government

Academia

HUMAN RESOURCE AND MANPOWER ISSUES

Academia
Industry

Academia

Curriculum should be restructured

according to industrial requirements

Industry
Industry-Academia
collaboration is
imperative.

By creating more opportunities for the

development of human resource
potential.

Primary sector (Agriculture)

(Underemployment)

Manufacturing sector
(Productive employment)