Growth in steel demand to slow to 7.2%

Our Bureau Mumbai | Updated on April 10, 2019 Published on April 10, 2019

A decline in offtake is seen in automotive, consumer durables sectors, says industry body

The Indian Steel Association expects growth in steel demand to slow down to 7.2 per cent for the next two fiscal due to relatively slow growth in major consuming sectors such as automotive and consumer durables. Steel demand had grown by 8 per cent in 2018.

India’s steel consumption is expected to cross 100 million tonnes this year, it added.

The World Steel Association had estimated steel demand in India to touch 103 million tonnes this year, against 96 mt logged in 2018. It would further grow up to 110.2 mt in 2020, it had said.

The automotive sector is witnessing softer demand since last October. Going by the recent trend and a strong base effect, growth is expected to slow down in the first half of 2019, the Indian Steel Association said on Wednesday. The steel industry expects demand from the automobile sector to revive in July due to pre-buying before the BS-VI norms kick in.

Steel demand from the consumer durables sector is expected to normalise after a strong growth was logged last year. Among consumer durables, air-conditioner, washing machine and refrigerator sales were boosted by a cut in GST rates.

The growth in both automotive and consumer durables sectors are expected to slow down to seven per cent each for the next two years from 16 per cent and 22 per cent clocked last year. Intermediate goods, which is driven by both investments and consumption, will see some moderation in demand on account of weaker growth in the automotive sector, said ISA.

The growth in the Indian economy slowed down in the second half of last year due to weak rural demand, high oil prices and rupee depreciation against dollar.

Going ahead, revival in private investment is expected to support the economy with consumption demand improving driven by concessions extended to farmers, unorganised sector and government employees. Cumulatively, the Indian economy is likely to maintain over 7 per cent growth for the next couple of years, it said.

Investment driven sectors such as construction, capital goods and railways are likely to maintain the healthy growth momentum driven by infrastructure programmes such as Bharatmala, Sagarmala, Railway track electrification, dedicated freight corridors and metro rails.

GST reduction

While reduction in GST rates will support the real estate demand, ongoing capacity additions in renewable energy segment will boost the electrical equipment demand. Construction sector growth is estimated to be at 7.2 per cent in the next two years, whereas capital goods and railways are projected to grow by 6.8 per cent and 6.5 per cent, respectively.

Published on April 10, 2019

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!


Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.