Understanding steel industry situation in India, because we know india is one of the most productive countries in the world which has numerous of industries work in here. One of the most significant industries in India is steel and iron industry. The high number of steel productions in India are even able to replace Japan as the world’s second – largest steel producer industries in January 2019.
The number of crude steel being produced by India is growing from year to year. The number of crude steel produced in 2018 is 4.9% higher than in 2017. Meanwhile, the number of finished steel produced by India steel industries is 82.68 million tons in 2018. The rapid development of India steel industries is supported by government policy from Indian Ministry of Steel.
Understanding Steel Industry Demand and Production Capacity
There are two main factors of rapid growth in the steel industries sector in India. Cost – effective labor and high availability of domestic raw materials are two main factors. The high production number of finished steel product has been the main contributor to manufacturing output in India.
There are three categories of steel industries in India such as major producers, main producers, and secondary producers. The increased number of steel production in India has been correlated with the growth of finished steel consumption in India. India’s steel export during April 2020 and October 2020 stood at 7.10 MT while India’s steel import stood at 2.35 MT.
India plans to increase the production capacity in steel sector up to 300 million tonnes in 2030. The steel industries in India contribute for about 2 percent to the country’s GDP. The high number of steel production in India enables this country to overthrow three developed countries such as Russia, US and South Korea.
Despite the high number of steel production from this country. The number of steel consumption is rather lower compare to the other countries that produce high number of steel either. For example, compare to China which both are developing nation and have much resemblance. The capita steel consumption is only one – eight to China.
The India’s Steel Industry Investment
There is a great number of increased investment in steel industry, metallurgy and mining sectors in India. The number of Foreign Direct Investment (FDI) in steel industry sector has able to attract up to US$ 14.22 billion from April 2000 to June 2020.
Tata Steel is one of the steel industry investors in India that has decided to increase the capacity of their steel plant in Kalinganagar to 8 million tonnes from 3 million tonnes. This investment takes up to US$ 3.64 billion. Besides, the support also come from India’s government, in this case is Ministry of Steel.
India’s Ministry of Steel aspires to accelerate the development of steel sector in the eastern region of India by investing up to US$ 70 million. By preparing a draft framework for steel industry sector development in this country. To increase the demand of the local steel, India Government improve the infrastructure development.