India, with the production of about 24 million tonnes (MT) of crude steel annually is the tenth largest producer of steel in the world. The aggregate crude steel capacity of working units at present is nearly 34 MT per annum which is shared by the Integrated Steel Plants and Electric Furnace Units. Besides, there are a large number of steel processing units, merchant pig iron plants (cap: 3.66 MT) and sponge iron plants (cap: 6.3MT). India continues to be the second largest producer of sponge iron in the world.

    The world steel consumption, by and large, has been increasing. But the total finished steel consumption in 1998 was 693,3 MT, 5 million tonnes less than 1997. The reduction is largely due to recession, lack of demand and excess production. But the International Iron & Steel Institute (IISI) expects that world steel consumption would rise by 2.9 per cent in the year 2000 to 719 MT, up from an estimated 699 MT in 1999. IISI also believes that global consumption may rise to as high as 763 MT in the year 2005. The World Steel Dynamics (WSD) has predicted that world steel consumption would increase to 787.6 MT in 2005 and 889.6 MT in 2010. A recent survey reveals that the steel consumption pattern will look up with a marginal increase in the consumption of steel by 20-30 million tonnes by 2005. This might take the world steel production figure close to 700 million tonnes. It is further projected that the developing countries, particularly, the South-East Asian countries will be the high growth areas for iron and steel. India, having a competitively advantageous position, both locationally as well as in terms of steel capacity, is well poised to become a major global player.

    The apparent consumption of steel in the country has been increasing. The average annual growth during the past has been over 6 per cent, though there had been annual fluctuations. India’s per capita crude steel consumption is, however, abysmally low. This is only 24 kg. It is not only much lower than other developed countries 422 kg in USA, 417 kg in Germany, 109 kg. in Russia; it is not even one fifth of the world average 121 Kg. Even China, with a population larger than India’s, has a per capita steel consumption of 87 kg. The wide gap in relative consumption of steel indicates that the potential ahead for India in raising its steel consumption and prospects for development of the Indian steel industry to sustain the growth momentum is quite rosy.

    India possesses some of the unique advantages in iron and steel sector which need to be exploited. India has cheap and high grade iron ore and other ferrous minerals. The other factors are: lower labour cost, availability of basic manufacturing facilities, availability of minimum basic infrastructure, trained human resource with vast experience and knowledge base and massive potential for consumption.

    A national Task Force, constituted in 1991-92 evolved a 20-year action plan for the growth of iron and steel industry and projected a 9 per cent cumulative growth of steel in India till 2001-02, followed by 7.5 percent average cumulative growth rate till 2011-12. Quantitatively, the Task Force predicted that India could be producing around 31 MT of finished steel by 2001-02, 42 MT by 2006-07 and 57 MT by 2011-12.

    The Post-liberalization period has witnessed modernisation and expansion of some of the existing Integrated Steel Plants and large investment to the order of Rs.30,000 crore sanctioned by the financial institutions for setting up of new/green-field steel plants with a total capacity of about 13 MT. Most of these plants are in the private sector. The plants are under various stages of implementation and are likely to be fully operational during the first few years of the new millennium. These plants would bring about a shift in the overall capacity and availability of steel in the country and a sea change in the technology profile of the steel industry. This would enable production of steel of international quality. State-of-the art plants with greater manufacturing flexibility, higher process control and automation, and low manpower costs would result in lower operational costs, making the Indian steel industry amongst the lowest cost steel producers in the world and capable of competing globally.

    Experts agree that steel has a future in this country and India has the potential to become a leader in the steel sector in the world. The axis of steel growth is gradually shifting from the developed economies to the developing economies and in Asia in particular. This is yet another opportunity, which could be captured for rapid growth in the Indian steel sector. In order to realise this potential, initiatives are required both at the level of Government as well as the industry.

    At this juncture it is worth mentioning that against a target of 100 MT of crude steel production by the end of 20^th century, we have in the last 50 years achieved a level of 34 MT only. It should be our endeavor to strive for achievement of the target of 100 MT in the new millennium at the earliest, with excellent partnership and endeavours by the Government and the Indian iron and steel industry.

    The Government has recently decided to set up a Steel Exporters Forum, an Institution for Steel Development & Growth (INSDAG) and an Empowered Committee for Research & Development. It will launch a national campaign for increasing demand for steel in non-traditional sectors. Construction and infrastructure sector should also open new avenues to help the Indian steel industry to fulfil its dream of becoming a world leader in the new millennium. It is time for the steel majors to innovate and cultivate more use of steel in the country.