Sponge iron units voice grievances

The sponge iron or direct reduced iron (DRI) industry in West Bengal has formed an association to mitigate the problems currently facing the units and to collectively take up the issues with the state government.

West Bengal Sponge Iron Manufacturers' Association (WBSIMA) has alleged that the sponge iron units in the state have contributed Rs 300 crore to the exchequer without getting even a rupee as return for the development of the sector.

The association has laid out a charter of demands for the state government. According WBSIMA, frequent power failure is a big problem for sponge iron units and the association has sight help from the state government to develop its own power generation plant. Some of the plants had not been given power as yet.

Local road transport had become a menace for the sponge iron industry. Transporters were forming small associations forcing the units to work on their own terms and conditions.Moreover, many DRI plants were not supplied with adequate water.

Among the list of of recommendations, the sponge iron also mooted framing a proper minimum wages scheme for the DRI industry. This stemmed from the move that some local people were forcing to sign agreement with individual units.

The association highlighted the importance of the role of sponge iron units. WBSIMA pointed out, the availability of scrap for the huge quantum of steel proposed to be produced would be inadequate and therefore scraps would have to be replaced more and more by DRI.

"With resourced available in India, the sponge iron-electric arc furnace route is the most viable option for steel making" said WBSIMA sources .

According to estimates by the World Steel Dynamics (WSD), the global shortage of scrap would reach 68 million tonne in the year 2010, which implied that the scrap price would go up and availability would be a problem.