Steel sector needs policy clarity

The industry was impacted by issues veering around mining lease renewals which led to intermittent stoppage of mining operations leading to disruption in the end use operations. Tata Steel imported iron ore for the first time. It is ironical that, as a country, we have to import iron ore despite having some of the best iron ore reserves in the world. India is the fourth largest producer of steel in the world and also its third largest consumer. Policy clarity and stability, especially with regard to renewal of mining leases and forest clearances, are imperative to ensure the growth of the steel industry. We are hopeful that the government will address the concerns of the steel industry in this regard in the new year.

Forecasts indicate that the domestic economy will grow at around 6 per cent buoyed by a stable government at the Centre, economic reforms and a turnaround in manufacturing. This is good news for the steel industry. While the emerging scenario looks positive, steelmakers in India face a challenging future, as they may not be able to add capacity to keep pace with the rising demand. The need of the hour is to steer new investments in the industry with appropriate policy support so as to ensure that production of steel matches the growth in consumption.