You are here: Home » Markets » Commodities » Industrial Metals
Business Standard

Govt faces uphill task for 300 mt steel output target

The battle for land rights across the nation has stalled many steel projects

Ishita Ayan Dutt  |  Kolkata 

Steel, metal

The draft Policy has set a target of 300 million tonnes (mt) capacity by 2030, which would require 91,000 acres additional land.

The policy — put up on the ministry website for public viewing — acknowledges that land requirement is based on greenfield expansion. The draft mentions the growth plans of Indian industry, which has been hindered by difficulties in land acquisition and many projects are stuck due to policy and procedural issues. To achieve the target, therefore, the ministry plans to coordinate with the state governments to ensure timely availability of litigation-free lands to the industries.

Sanak Mishra, secretary general, Indian Association, said around half the capacity of the additional 178 million tonnes would be through greenfield expansion and the thumb rule for land requirement is 1,000 acres for one million tonne of capacity. Hence, the 91,000 acres for the additional capacity. The current installed capacity is about 122 million tonnes (mt). But, over the past decade most of the addition in capacity has come through brownfield expansion due to hurdles in land acquisition. The ratio of expansion through brownfield to greenfield would be 60:40, said Mishra. 

“Crude capacity in India in 2005-06 was around 45 mt. In 1991-92, it was 22 mt. It means in the last 25 years, we have added 100 million tonnes,” Mishra pointed out.

Yet the battle for land rights across the nation has stalled many projects. In 2005-06, mega greenfield projects that were announced added up to 100 mt capacity, including the ones of Posco and In recent times, the only greenfield project of significant size to be commissioned was Tata Steel’s Kalinganagar project.

Sushim Banerjee, director general, Institute for Development and Growth, however, pointed out that the bigger worry, going forward, could be market absorption.

Domestic demand has been a cause of concern for the industry. Larger players have remained somewhat insulated from this problem because of measures initiated by the to curb and a strong export market. But it may not be an incentive for players to set up greenfield plants, especially foreign players. During April to February, consumption has increased at a disappointing rate of 3.39 per cent to 76.2 mt.

A case in point could be The world's largest steelmaker may have faced land acquisition problems in Odisha but in Karnataka it had the land in place, said sources. 

It pulled out of the project due to the global crash. A muted domestic demand is not much of a help either. The industry feels that a domestic procurement policy should be finalised to encourage making in India.

RECOMMENDED FOR YOU

Govt faces uphill task for 300 mt steel output target

The battle for land rights across the nation has stalled many steel projects

The draft National Steel Policy has set a target of 300 million tonnes capacity by 2030 which would require an additional land requirement of 91,000 acres.The policy - put up on the ministry website for public views - acknowledges that the land requirement is based on greenfield expansion. The draft mentions that the growth plans of the Indian steel industry have been hindered by difficulties in land acquisition and many projects are stuck due to policy and procedural issues. To achieve the target, therefore, the ministry plans to coordinate with respective state governments to ensure timely availability of litigation-free lands to the industries.Sanak Mishra, Secretary General, Indian Steel Association, said that about half the capacity of the additional 178 million tonnes would be through greenfield expansion and the thumb rule for land requirement is 1,000 acres for one million tonne of steel capacity. Hence, the 91,000 acres for the additional capacity.The current installed ...
The draft Policy has set a target of 300 million tonnes (mt) capacity by 2030, which would require 91,000 acres additional land.

The policy — put up on the ministry website for public viewing — acknowledges that land requirement is based on greenfield expansion. The draft mentions the growth plans of Indian industry, which has been hindered by difficulties in land acquisition and many projects are stuck due to policy and procedural issues. To achieve the target, therefore, the ministry plans to coordinate with the state governments to ensure timely availability of litigation-free lands to the industries.

Sanak Mishra, secretary general, Indian Association, said around half the capacity of the additional 178 million tonnes would be through greenfield expansion and the thumb rule for land requirement is 1,000 acres for one million tonne of capacity. Hence, the 91,000 acres for the additional capacity. The current installed capacity is about 122 million tonnes (mt). But, over the past decade most of the addition in capacity has come through brownfield expansion due to hurdles in land acquisition. The ratio of expansion through brownfield to greenfield would be 60:40, said Mishra. 

“Crude capacity in India in 2005-06 was around 45 mt. In 1991-92, it was 22 mt. It means in the last 25 years, we have added 100 million tonnes,” Mishra pointed out.

Yet the battle for land rights across the nation has stalled many projects. In 2005-06, mega greenfield projects that were announced added up to 100 mt capacity, including the ones of Posco and In recent times, the only greenfield project of significant size to be commissioned was Tata Steel’s Kalinganagar project.

Sushim Banerjee, director general, Institute for Development and Growth, however, pointed out that the bigger worry, going forward, could be market absorption.

Domestic demand has been a cause of concern for the industry. Larger players have remained somewhat insulated from this problem because of measures initiated by the to curb and a strong export market. But it may not be an incentive for players to set up greenfield plants, especially foreign players. During April to February, consumption has increased at a disappointing rate of 3.39 per cent to 76.2 mt.

A case in point could be The world's largest steelmaker may have faced land acquisition problems in Odisha but in Karnataka it had the land in place, said sources. 

It pulled out of the project due to the global crash. A muted domestic demand is not much of a help either. The industry feels that a domestic procurement policy should be finalised to encourage making in India.
image
Business Standard
177 22

Govt faces uphill task for 300 mt steel output target

The battle for land rights across the nation has stalled many steel projects

The draft Policy has set a target of 300 million tonnes (mt) capacity by 2030, which would require 91,000 acres additional land.

The policy — put up on the ministry website for public viewing — acknowledges that land requirement is based on greenfield expansion. The draft mentions the growth plans of Indian industry, which has been hindered by difficulties in land acquisition and many projects are stuck due to policy and procedural issues. To achieve the target, therefore, the ministry plans to coordinate with the state governments to ensure timely availability of litigation-free lands to the industries.

Sanak Mishra, secretary general, Indian Association, said around half the capacity of the additional 178 million tonnes would be through greenfield expansion and the thumb rule for land requirement is 1,000 acres for one million tonne of capacity. Hence, the 91,000 acres for the additional capacity. The current installed capacity is about 122 million tonnes (mt). But, over the past decade most of the addition in capacity has come through brownfield expansion due to hurdles in land acquisition. The ratio of expansion through brownfield to greenfield would be 60:40, said Mishra. 

“Crude capacity in India in 2005-06 was around 45 mt. In 1991-92, it was 22 mt. It means in the last 25 years, we have added 100 million tonnes,” Mishra pointed out.

Yet the battle for land rights across the nation has stalled many projects. In 2005-06, mega greenfield projects that were announced added up to 100 mt capacity, including the ones of Posco and In recent times, the only greenfield project of significant size to be commissioned was Tata Steel’s Kalinganagar project.

Sushim Banerjee, director general, Institute for Development and Growth, however, pointed out that the bigger worry, going forward, could be market absorption.

Domestic demand has been a cause of concern for the industry. Larger players have remained somewhat insulated from this problem because of measures initiated by the to curb and a strong export market. But it may not be an incentive for players to set up greenfield plants, especially foreign players. During April to February, consumption has increased at a disappointing rate of 3.39 per cent to 76.2 mt.

A case in point could be The world's largest steelmaker may have faced land acquisition problems in Odisha but in Karnataka it had the land in place, said sources. 

It pulled out of the project due to the global crash. A muted domestic demand is not much of a help either. The industry feels that a domestic procurement policy should be finalised to encourage making in India.

image
Business Standard
177 22