Steel industry faces many challenges

India has a tremendous competitive advantages in steel industry. But there are a few major challenges for the industry to graduate to higher production levels, a top official of Tata Steel said.

Addressing the silver jubilee celebrations of the Madras Mettalurgical Society, B Muthuraman, managing director of Tata Steel, said that the Indian steel industry was expected to grow at 7-8 per cent in tune with the GDP growth over the next few years and was expected to reach a capacity level of 300-400 million tonnes in the next 3-4 decades as against the present 35-40 million tonnes.

However, he said there were a few challenges to be addressed to graduate to these levels and stressed on the need for a long-term plan. The biggest challenge would be in the human resources area while other challenges would be in infrastructure, building design and engineering capabilities.

Referring to human resource as a major challenge, he said that the onus was on the industry to attract the young minds to take up metallurgy and not the responsibility of educational institutions or the government.

"There is a need for fundamental shift in our thinking and the industry should shape the young minds to excite them to join the steel industry," he added. Another challenge, he said, was building design and engineering capabilities. India can't depend on external agencies for help in every technology.

A new thinking is required to graduate to higher production levels and we should look at developing our own design and engineering capabilities, he said adding that there were about 20,000 mettalurgy engineers working in design institutes in China compared to 100 engineers in India.

Another major challenge facing the Indian steel industry, Muthuraman felt was the infrastructure. "India has the potential to make steel at the lowest cost but infrastructure is a big hurdle. Unless infrastructure development catches up, we will not harness the potential for making the country a powerful nation," he said.

He said that government regulations and policies should also be framed in such a way as to harness the potential in the industry. which has the competitive advantage to produce steel and steel products. Muthuraman felt that land acquisition closer to iron ore reserves and water, etc, was another major problem.

Though the Indian steel industry is about 100 years' old, it lagged behind in research, development and innovation, he said adding that "steel is not a commodity and steel-making involved a lot of R & D and technology."