India is one of the largest producers of steel, a key input material for various infrastructure projects. In the context of the forthcoming Budget, Bhaskar Chatterjee, Secretary-General and Executive Head, Indian Steel Association, spoke to BusinessLine on the consumption pattern, problems and solutions for the sector. Excerpts:

What is your growth outlook for steel consumption? What are the main sectors that consume steel?

Steel consumption in key sectors is likely to grow by 7 per cent and 7.2 per cent during 2019 and 2020 respectively. In 2018, the Railways consumed three per cent, and with 62-per cent share, the construction sector consumes most of the steel used in the country.

Is the domestic industry able to meet the demand from the Railway and road sectors? How much steel demand for the dedicated rail freight corridor and bullet train can be met by the domestic steel industry?

The domestic industry has been able to meet most of the demand for the Railway and road sectors. Some steel requirement for these two projects are met by imports. Funding countries generally stipulate usage of steel of their country or put specifications more suiting to them.

What are the challenges in moving raw material and finished goods for steel in the country?

The steel industry is facing difficult times due to non-availability of railway rakes. Freight charges for coal, limestone, minerals like manganese are lower than that for iron ore. This increases steel costs.

The General Purpose Wagon Investment Scheme of the the Railways needs to iron out issues such as return on investment, terminal access charges and empty wagon charges.

What steps can the government take to improve the health of the domestic steel sector?

Some of the steps to be taken include the levy of a safeguard duty on articles of iron and steel to protect against surging imports.

We have sought an exemption for steel products from the Regional Comprehensive Economic Partnership (RCEP). A review of Free Trade Agreements with respect to concessional duties which are currently ‘zero’ for Japan, Korea is also warranted.

Bringing more steel products under the purview of steel and steel product quality control order/s to control import of sub-standard and defective steel will support the ‘Make in India’ initiative and aid the domestic sector.

There is also a need to bring into operation the Steel Import Monitoring Agency.

The Centre should focus on uninterrupted supply of raw materials such as iron ore and coal for steel production.

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