Out of the Eight core Industries, Iron-steel industry one of the heavy core industry in India. Steel industry directly contributes 1.4 to 2% to India's GDP & its weightage in the official Index of Industrial Production (IIP) is 7.22% and accounts for 7.33% of the Wholesale Price Index (WPI).
Iron-steel industry is the raw material oriented industry. It is weight losing industry (that means differences between weight of raw material and weight of finished product e.g. RM : FP = 10 : 1).
Basic Requirements for Iron-steel Industry :
* Availability of iron ore.
* Coking Coal
* Maganese
* Dolamite
* Power
* Dolamite
* Power
* Fluxing material (limestone to segregate impurities)
* Water (river, lake)
* Transport Networks (rail, road, waterway)
* Cheap labour
* Good governance
* Financial institutions
* Market
* Climate
* Ore based Iron-steel Industry (industry near raw materials)
* Coal based Iron-steel Industry (industry near coal field for energy)
* Port based Iron-steel Industry (industry develop at port for market)
* Climate
Localisation of Iron-steel Industry in India :
* Chhotanagpur Plateau is Hotspot of Iron-steel Industry in India.* Ore based Iron-steel Industry (industry near raw materials)
* Coal based Iron-steel Industry (industry near coal field for energy)
* Port based Iron-steel Industry (industry develop at port for market)
Evolution and Growth of Iron-steel Industry in India :
Before Independence :
* The modern industry had its beginnings in 1870 when Bengal Iron Works Company was established in Kulti in West Bengal.
* The large scale industrial production of steel started only with the setting of TISCO (Tata Iron & Steel Company) in Jamshedpur, Jharkhand in 1907.
+ It's old conventional industry started from British period.
+ Use : wrought iron, pig iron, recycling unit.
* TISCO was set in 1919 at Burnpur (West Bengal), Kulti & Haripur.
* Visvesvarayya Iron & Steel Limited was set in 1923 at Bhadravati, Mysoor.
+ Connect to Manglore, Pune for export & import in international market.
+ River flows : Bhadravati river
+ Energy : use hydroelectricity
After Independence :
* During Second Five Year Plan (1956-61) -
+ Rourkela Steel Plant at Sundargarh, Odisha with collaboration of Germany.
+ Bhilai Steel Plant at Durg, Chhattisgarh with collaboration of Russia.
+ Durgapur Steel Plant at Durgapur, West Bengal with collaboration of United Kingdom.
+ Bokaro Steel Plant in Jharkhand with collaboration of Russia.
* In 1973 establishment of SAIL (Steel Authority of India Limited) to manage these Public Sector Undertaking (PSU's).
* New Steel Plants
During 4th Plan Period (1969-74) :
+ Visakhapatnam Steel Plant - port based Industry.
+ VijayNagar Steel Plant, Hospet, Karnataka. (1971)
River : Tung Bhadra
Coal : from Sringeri
Cheap labour availablity
+ Salem Steel Plant, Tamil Nadu.
River : Kaveri
Coal : from Neyvelli (lignite).
Note : India is 3rd largest exporter of steel, and largest exporter of Sponge Iron.
* Research and development in iron and steel industry in India is very low.
* High use of coking coal release of carbon monoxide and carbon dioxide during smelting (increase pollution).
* Lack of availability of coking coal.
* Low labour productivity.
* Inadequate Infrastructure : Recently, FDI has brought in new technology.
* Irregular energy supply.
* India export iron ore but import steel.
* Not much domestic consumption.
+ It's old conventional industry started from British period.
+ Use : wrought iron, pig iron, recycling unit.
* TISCO was set in 1919 at Burnpur (West Bengal), Kulti & Haripur.
* Visvesvarayya Iron & Steel Limited was set in 1923 at Bhadravati, Mysoor.
+ Connect to Manglore, Pune for export & import in international market.
+ River flows : Bhadravati river
+ Energy : use hydroelectricity
After Independence :
* During Second Five Year Plan (1956-61) -
+ Rourkela Steel Plant at Sundargarh, Odisha with collaboration of Germany.
+ Bhilai Steel Plant at Durg, Chhattisgarh with collaboration of Russia.
+ Durgapur Steel Plant at Durgapur, West Bengal with collaboration of United Kingdom.
+ Bokaro Steel Plant in Jharkhand with collaboration of Russia.
* In 1973 establishment of SAIL (Steel Authority of India Limited) to manage these Public Sector Undertaking (PSU's).
* New Steel Plants
During 4th Plan Period (1969-74) :
+ Visakhapatnam Steel Plant - port based Industry.
+ VijayNagar Steel Plant, Hospet, Karnataka. (1971)
River : Tung Bhadra
Coal : from Sringeri
Cheap labour availablity
+ Salem Steel Plant, Tamil Nadu.
River : Kaveri
Coal : from Neyvelli (lignite).
Note : India is 3rd largest exporter of steel, and largest exporter of Sponge Iron.
Challanges of Iron-steel Industry in India :
* Contain high quality and credit iron and steel (like hot rolled coils, cold rolled coils) are not produce in India due to low demand. So, India has to depend on import to meet these demands, Making India a net exporter of finished steel, increasing Current Account Deficit (CAD), but now India have good approach towards to solve this problems.* Research and development in iron and steel industry in India is very low.
* High use of coking coal release of carbon monoxide and carbon dioxide during smelting (increase pollution).
* Lack of availability of coking coal.
* Low labour productivity.
* Inadequate Infrastructure : Recently, FDI has brought in new technology.
* Irregular energy supply.
* India export iron ore but import steel.
* Not much domestic consumption.
Government Initiative for Iron-steel Industry Development in India :
After liberalisation, government enhance the availability of Steel in the country in following ways -
* Removing the Steel sector from the list of industry reserved for public sector and open for private sector also.
*Steel industry accepting from compulsory licensing.
* Import of foreign technology as well as foreign direct investment (FDI) are permitted under automatic route with certain limits.
* Government provides fiscal and other policy measures for the growth of Steel sector.
* Currently, excise duty on steel is set at 14% and there is no export duty on steel items.
* The government has imposed export duty of 30% on all forms of iron ore except low grade iron ore.
* Under Mines & Minerals (Development and Regulation) Amendment Act, 2015 & rules to bring transparency in allocation of raw materials.
* Above act also allow transfer of captive mining leases, grated otherwise than through auction, during mergers and acquisitions of companies and facilitate ease of doing business for company to improve profitability and decrease costs of the companies.
* The fast track various clearances/resolution of issues related to investments of Rs 1,000 crore or more by
the Project Monitoring Group (PMG) under the Cabinet Secretariat.
* RBI also provide periodically concession for steel industry.
* Government ensure that quality control of steel in the country.
* Ministry of steel has provided necessary information about steel sector, such as, policies of the Ministries, various incentive schemes and opportunities available to make it convenient investors to take investment decisions.
Summary :
Iron-steel Industry in India is backbone for industrial growth in the country.
* Removing the Steel sector from the list of industry reserved for public sector and open for private sector also.
*Steel industry accepting from compulsory licensing.
* Import of foreign technology as well as foreign direct investment (FDI) are permitted under automatic route with certain limits.
* Government provides fiscal and other policy measures for the growth of Steel sector.
* Currently, excise duty on steel is set at 14% and there is no export duty on steel items.
* The government has imposed export duty of 30% on all forms of iron ore except low grade iron ore.
* Under Mines & Minerals (Development and Regulation) Amendment Act, 2015 & rules to bring transparency in allocation of raw materials.
* Above act also allow transfer of captive mining leases, grated otherwise than through auction, during mergers and acquisitions of companies and facilitate ease of doing business for company to improve profitability and decrease costs of the companies.
* The fast track various clearances/resolution of issues related to investments of Rs 1,000 crore or more by
the Project Monitoring Group (PMG) under the Cabinet Secretariat.
* RBI also provide periodically concession for steel industry.
* Government ensure that quality control of steel in the country.
* Ministry of steel has provided necessary information about steel sector, such as, policies of the Ministries, various incentive schemes and opportunities available to make it convenient investors to take investment decisions.
Summary :
Iron-steel Industry in India is backbone for industrial growth in the country.
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