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The government is working on a new steel policy in a bid to steer the over USD 100 billion industry out of the rut and ensure that the growth is evenly spread across all the related sectors.
"We are in favour of a new steel policy and I am already on the job," Steel Minister Chaudhary Birendra Singh told PTI.
He added that India led the world in growth in production and consumption last year, which has continued so far in 2016 as well.
"But, we need to ensure that this growth continues and for that we have to plan accordingly and come out with a policy that ensures that not only steel, but the related sectors such as iron ore, etc also grow," he explained.
Government's think-tank Niti Aayog too has pitched for for a "new and dynamic steel policy" to bring the industry back on track as well as meet the target of 300 million tonnes (MT) capacity by 2025.
The country's premier policy maker feels that mere changes in the National Steel Policy, 2012, will not help the sector as in the last few years the domestic market has been flooded with cheap imports from China, Korea and Japan, impacting its sales and profits, which has negatively influenced its capacity to repay debts.
"There is need for a new and dynamic steel policy. Seeing the current situation of the steel sector, it may be unlikely to achieve the targets envisaged in National Steel Policy 2012 i.E. A capacity of 300 MT and production of 275 MT by 2025," the Aayog said in a Working Paper on the sector.
It further said, "To bring steel sector back on track, mere tinkering in the present policy would not bring out a transformational change that is required."
The Aayog feels that there is a need to examine the entire value chain associated with the industry, from raw materials to production of finished products, to discover the bottlenecks in the sector.
The working paper, prepared by Niti Aayog Member V K Saraswat and Niti Aayog professional Ripunjaya Bansal, said that an ecosystem has to be created that will ensure profitability of the associated industry be it mining, pet coke, pellet, sponge iron, etc.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)