Steel boom beckons ore-bearing states

The eastern states like Orissa, Jharkhand and Chhatishgarh, which have more than 55 percent of total iron ore reserves of the country, can take advantage of the emerging opportunities in the steel sector, according to the experts who participated in an international seminar on steel here today.

Speaking at the seminar, Varun Jha, vice-president Tata Steel, said, with Indian economy on the upswing steel would be the key sector to catapult these states.

"There is huge risk, if we don't take advantage of the opportunities", he added.

Stating that India is a young nation with maximum number of persons below 25 years of age, he said, the country is benefiting from this demographic dividend.

Besides, it is emerging as an export base for items like IT and auto components.

He said, conservative estimates put the steel demand of the country at 150 million ton by 2020.

This will require crude steel production of about 175 million tonne.

Significantly, most of the capacity additions will come from the greenfield projects in the eastern states.

As there are problems relating to land acquisition and various clearances, the companies will have to work in tandem with the respective state governments.

However, the existing infrastructure in these states in terms of port, road and railways is inadequate to meet the demands of rapid industrialisation.

Moreover, with most of the projects slated to come in rural areas, skill upgradation of local people poses a big challenge.

He suggested setting up a common mechanism for faster forest and environmental clearance.

Among the eastern states, Orissa is in an advantageous position and the political leaders and the executives need to change this opportunity into reality.

U P Singh, steel and mines secretary, government of Orissa, said, there is huge scope for raising the per capita steel consumption in the country.

It was 35 kgs in India compared to 150 kg in the world and 250 kg in China.

As per the revised target Government of India (GoI) has fixed a target of 200 million ton steel production by 2020.

It will require mining of 350 million ton of iron ore.

Stating that availability of iron ore will be crucial to meet this target, he suggested phasing out of iron ore export in the long run while freezing the exports at the current level.

Besides, he emphasized on beneficiation and pelletisation of low grade iron ore.

Regarding the current reserve of iron ore he said, the reserves in Orissa estimated at 5300 million ton is sufficient for production of 75 million ton steel over a period of 40 years.

Admitting that the exploration has not been scientific, he suggested intensive exploration to be undertaken beyond 30 metres.

The process of negotiation with the land owners for land acquisition as adopted by some developed countries may be emulated here, he added.

That apart, downstream and ancillary industries need to be promoted by mega industries coming to Orissa as it promotes employment and augments the revenue of the state government.

In his inaugural address state finance minister Prafulla Ghadai said, there is vast scope for utilisation of low grade ore in Orissa. The industries need to take a lead in the matter.

The Chief Minister is regularly reviewing the progress of different projects in the state, he pointed out.

Viresh Obrei, managing director of Mjunction, the organizers of the seminar, delivered the welcome address.