The Hindu Business Line : Govt not to interfere in steel pricing: Paswan

The Minister for Steel, Mr Ram Vilas Paswan, along with (from left) Mr S. K. Roongta, Chairman and Managing Director, SAIL; Mr Rajeev Chandrasekhar, President, FICCI; and Mr B. Muthuraman, MD, Tata Steel; at the ‘Indian Steel Conclave 2008’ in the Capital on Wednesday.

Our Bureau

New Delhi, July 16 The Government on Wednesday indicated that it may not interfere and influence steel prices if the producers effect price changes in August after their self-imposed moratorium to hold prices for three months up to July end.

The steel manufacturers had assured the Prime Minister at a meeting in early May that they will not increase prices for the next three months.

The understanding was for the spot market and long-term contract prices were outside the periphery of the agreement as it is decided through bilateral negotiations between the buyer and the seller. Negotiated contractual prices have already increased for new agreements starting from July.

The Minister for Steel, Mr Ram Vilas Paswan, indicated that the Government will not interfere with steel pricing this time as it had done earlier in April and May.

“We are not in favour of interfering with pricing,” he said.

Last time in April-May when steel prices soared following input cost hikes, the Government interfered because of the principles of the “welfare state” to protect the consumer but the benefits had not accrued to the common man and the middlemen has taken away the profits, the Minister said while delivering the inaugural address at the India Steel Enclave organised by the Ministry of Steel and the Federation of Indian Chambers of Commerce and Industries (FICCI).

Speaking on the occasion the Steel Secretary, Mr R.S. Pandey, said that “though domestic steel prices have gone up by around 30 per cent in the last four months still the rise is much less compared to international markets.”

“Even today Indian steel prices are still lower than international prices by around Rs 15,000-20,000 a tonne,” he said.

Mr Pandey also pointed out that the Government does not have any power to control steel prices. “The Government does not even have the statutory power to ask the steel companies at what price they are selling which product,” he said.