Joint Panel For Redefining Role; Urges Steel Corpus For Growth

In a bid to align itself to the altered domestic steel scenario, the Joint Plant Committee is planning to approach the steel ministry to convert itself into a Development Council.

The conversion would come under clause 6(1) of the Industries (Development & Regulation) Act, 1951.

The committee is currently working on a blueprint for bringing about the changeover and plans to place a formal proposal before the ministry during this week.

One of the principal functions of the proposed council would be to create an industry-controlled steel corpus for funding the industrys common development activities.

The corpus will be funded by imposing a nominal cess of Rs 2 per tonne of hot metal or crude steel produced by each consortium member. Plans are also underway to strengthen the committee by inducting more steel corporates.

According to steel ministry sources, the committees move to restructure itself is a fallout of the Moosa Raza Committee report, which had laid down parameters for the committee to convert itself into a service organisation.

Some of the benefits that would be derived by members include grants for research and development activities, rebates for supply of material to small scale industries and financial assistance towards pollution control. The committee would also undertake activities like project appraisal and export promotion on behalf of the industry, sources said. The committee has emphasised that the steel corpus would not be used to fund any administrative or other directly-related activities.

In its proposal to the ministry, the committee has stated that the committee would only play the role of a facilitator on behalf of the government and that it would ultimately be up to the industry to translate this initiative into action.

The present committee, under the chairmanship of the Development Commission for Iron & Steel, is represented by the Steel Authority of India Ltd (SAIL), Tata Steel, Rashtriya Ispat Nigam Ltd and the Railway Board.

According to sources, Essar Steel, Ispat Industries, Mukand Steel and Jindal Vijayanagar Steel are some of the larger corporates who have in-principle committed their membership to the proposed council.

The committee has decided to induct steel producing units having a production capacity above 0.5 million tonne into the committee.

The pattern of representation would be in proportion to the annual production capacity of each member. Companies with a production capacity between 0.5-4 million tonne would be allowed one representative, and those with capacities up to 6 million tonne would have two representatives. Companies having a production capacity of above 6 million tonne would be permitted to have three representatives.

Besides corporate bodies, the committee would also include nominees of five industry associations and the Central government. An executive committee consisting of not more than 10 members is also being considered.