Chhattisgarh government has taken the initiative to bail out country's secondary steel from the crises.
Chief Minister Raman Singh along with a delegation, met Union Finance Minister Arun Jaitley and took up the issue to give some respite to the secondary steel makers in the country, who are reportedly passing through the phase of worst-ever crises. The imported steel has been cited as one of the reasons as the local steel makers had failed to stand in competition in the international market following high price of raw materials in the country.
Singh said the secondary steel sector had been generating employment to over 600,000 people across the country and Chhattisgarh was one of the biggest steel producing states. A few units in the state had closed down while many had curtailed the production. The situation across the country was same.
Chhattisgarh's industry secretary Subodh Kumar Singh told Business Standard that the Finance Minister has assured that the Government of India would take necessary measures in the interest of secondary steel producers.
"The option of bringing down the price of iron ore and coal besides some tax relief for the steel makers were discussed in detail during the meeting," he said, adding that the Government of India would explore on the line to give breather to the ailing steel sector.
According to steel makers, the cut in the price of raw material would be the only option. "The price of coal and iron-ore should be at par with the international market," Anil Nachrani, former President of Chhattisgarh Sponge Iron Manufacturer Association, said. While the ex-mine price of iron-ore is about Rs 1600-1800 per tonne in the international market, the steel making raw material is being sold in India at Rs 4000 per tonne, he added. Following high price, the local steel makers could not make finish product and the imported steel was eating into their share.
Nachrani said it was a good initiative taken by the Chhattisgarh Chief Minister as the secondary steel shared country's 55 per cent production and needed some support for its survival.