Nod for Vizag Steel expansion soon

The Rs 8,500-crore expansion proposal of Visakhapatnam Steel Plant (VSP) is expected to get the approval of the Cabinet soon.

With the expansion, VSP's liquid steel production capacity will go up to 6.3 million tonnes from the existing 3 million tonnes.

Addressing mediapersons here on Thursday, Mano Ranjan, secretary, ministry of steel, Government of India, said, "The Public Investment Board (PIB) had chalked out the expansion plan of VSP and we are expecting the Cabinet's nod within a couple of months." Ranjan, however, ruled out the merger of VSP with SAIL.

"The steel ministry does not have any such proposal," he said.

The new steel policy, which will be presented before the Cabinet in July for approval, envisages 100 million tonnes of production by 2019-20 in the country, he said.

During last fiscal, the country produced about 38 million tonnes of steel which is expected to go up to 50 million tonnes in the next three years. By 2019-20, the steel production in the country will touch 100 million tonnes.

"Several new private and foreign companies are setting up steel units in India. Besides, the existing units are also going in for expansions. Owing to these reasons, the country's steel production is expected to touch 50 million tonnes within the next two to three years," he said.

The new steel policy will lay emphasis on production of special steel, which is currently below 10 per cent of the total production and exports of steel products. The country currently exports about 6 million tonnes of steel, which is about 16 per cent of the total production.

"Our target is to export at least 25 per cent of the country's total steel production," Ranjan pointed out. To boost the production of special steel in the country, the government is also providing funds for research and development.

According to Ranjan, the drop in steel prices in the international market is likely to increase the imports of steel in the current year.

Steel prices have dropped by $150 per tonne in the international market because of which steel imports have increased in the last couple of months, he said.

Last year, steel imports were about 2 million tonnes.

To formulate guidelines for granting mining licenses by various state governments, the central government has set up an experts committee which will prepare the guidelines on mines leasing, he said.