India set to become 2nd largest steel producer: ArcelorMittal

Says mergers and acquisitions in country's steel sector are likely to 'remain active'

India's economic prospects have improved and is likely to see major reforms as the coalition era has ended with the new government's majority in the Lok Sabha, steel giant ArcelorMittal has said.

It further said India is poised to become the second largest global steel producer, and mergers and acquisitions in in country's steel sector are likely to "remain active".

It may be noted that ArcelorMittal's proposed Rs 50,000- crore project in Jharkhand is stuck for over eight years now for want of regulatory clearances and land acquisition.

It had scrapped Rs 50,000-crore project in Odisha last year on account of problems in land acquisition and securing ore linkages.

The company had recently said that it continued to pursue greenfield projects in Jharkhand and Karnataka.

"Economic prospects have improved in India as the incoming government has won a Parliamentary majority in the Lower House, which breaks the long run of coalition governments, and is expected to allow for significant economic reforms," ArcelorMittal said in a report. The growth prospects in the country are bright, it added.

"The country has become the world's third largest steel consumer after China and the United States and is expected to become soon the world's second largest steel producer worldwide," it said.

The merger and acquisition activities are expected to "remain active in the Indian steel and mining industry though at a lower pace considering the current economic slowdown".

The integration of Ispat Industries into JSW Steel was a major consolidation step in 2010, the report said.