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The steel sector’s debt is being restructured to lower the interest burden on borrowers, Steel Minister Chaudhary Birender Singh said.
Speaking at the curtain-raiser of India Steel 2017, Singh said that debt worth ₹40,000 crore had been restructured as of January-end.
He added that nearly ₹1 lakh crore of debt will be restructured by this month-end.
The Steel Ministry has been working with the Reserve Bank of India to lower the interest outgo of borrowers. Singh said that the loans are being reworked to single digit interest loans from the existing 13-14 per cent rate of interest.
According to a July 2015 report of Credit Suisse, the total bad debt of the sector is estimated at ₹1.96 lakh crore.
Rising priceSingh said that the steel sector is on the path of recovery. He said, “Domestically, the price of steel has been rising by ₹8,000 to ₹10,000 per tonne, and the price of coking coal has stabilised at near $120 per tonne from $300 per tonne. A 30-35 per cent import substitution of imported thermal coal will also save ₹10,000-12,000 crore annually for the sector.”
Imports downHe added that the import of steel has come down 39 per cent since protectionist measures were implemented by the government, boosting the prospects of domestic manufacturers.
Anti-dumping duty is in place for 124 steel products and the government will extend this to more products, if needed, Singh added. He also defended India’s anti-dumping measures that have been opposed by Japan at the WTO.
He said, “Anti-dumping duty is a temporary measure and we have a strong case for upholding it.”
Exports surgeAccording to PTI report, steel exports have surged 78 per cent in the April-February period. The Steel Minister the past three years have been quite challenging for the steel industry and the government has intervened strategically to provide policy and regulatory support from time to time which has given desired results.
There has been “improvement in capacity utilisation to over 78 per cent, reduction in imports by 39 per cent and significant increase in exports by 78 per cent in the 11 months of current financial year,” he said.
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