Domestic steel may be mandatory for govt’s infrastructure projects | business-news | Hindustan Times
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Domestic steel may be mandatory for govt’s infrastructure projects

The Steel Ministry is likely to take to the Union Cabinet this month a proposal that seeks to provide preferential treatment to steel made in India in government projects.

business Updated: Apr 05, 2017 14:38 IST
(HT photo)

India is likely to mandate use of domestic steel for government infrastructure projects to boost demand for local companies and check cheaper imports.

The Steel Ministry is likely to take to the Union Cabinet this month a proposal that seeks to provide preferential treatment to steel made in India in government projects.

It may also seek Cabinet approval for the National Steel Policy (NSP), 2017 which seeks to double production as well as consumption and put forth strategies to overcome challenges like high input costs and financial stress facing the sector.

“We want to promote and encourage the growth of domestic steel industry and so we want that India-made steel should be given preference in government funded projects. A draft Cabinet note has already been initiated,” Steel Minister Chaudhary Birendra Singh said here.

He was addressing a national conference of secondary steel producers.

Asked whether the government plans to make it mandatory or on preferential basis, Singh said: “This should be taken on a preference basis. In government ministries and departments where the consumption of steel is more, like Railways, I want that on the preference basis, they should use steel made in India and it should be made part of the tender.”

Singh added however that steel which is not available in the country can be imported.

There would be a quantum jump in the steel consumption once the proposal is approved, he said, adding Railways, urban housing, shipping and national highways are big customers.

The government, he said, will spend Rs 4 lakh crore on infrastructure projects, which will boost steel demand.

On the new steel policy, Singh said: “We have already released the draft policy. We have also received feedback from stakeholders. We will include any good suggestions made by secondary steel producers. In this month only, we will send it to the Cabinet for approval”.

Through this policy, he said, the government plans to more than double the steel production capacity and per capita consumption from the present level.

In January, the ministry had released the draft policy to ensure that the steel sector follows a sustainable path of development in respect of augmenting capacity to 300 million tonnes by 2030-31 in environment friendly manner.

It is an effort to steer the industry to achieve its future potential and strategy to deal with various impediments like high input cost, availability of raw materials, dependency on imports and financial stress.

“India is going to become the second largest steel producer in the world by 2018,” he said.

Steel Secretary Aruna Sharma said the country’s steel production is estimated to rise 11% at over 90 million tonnes, while exports increased 57% last fiscal.

Imports is estimated to have declined by 34 per cent, she added. PTI MJH ANZ SA