The government is planning a series of measures to tackle the excessive import of seconds and defective steel products into the markets, steel secretary A K Aggarwal said yesterday.
Inaugurating a seminar on e-commerce in the steel industry here, Aggarwal, however, warned the domestic industry not to depend too much on government protection as it was neither possible nor desirable for the government to protect the domestic industry from all import competition in a globalised environment.
The global economic outlook was bullish and there was no danger of any sharp fall in the demand for steel, he said, adding that the growth in actual demand in the domestic steel industry was slow only in comparison to the projected demand.
He expressed happiness at the fact that the domestic steel industry had ended the first quarter on a positive note recording a 9.7 per cent growth in production of finished steel products over the corresponding period last year.
He said that apparent consumption of steel has also increased substantially. Exports continue to be high but as a result of the economic crisis, the domestic and export prices of steel have fallen in recent months, he added.
Aggarwal asked the domestic industry to take steps to improve efficiency otherwise the industry would face a threat of closure. In order to do this, the domestic steel industry has to adopt the best available technology so as to remain technologically competitive, he added.
Globalisation of the economy has meant that the domestic industry is faced with a dichotomous situation, where market players have immense opportunities to grow but at the same time players have to be alert and have complete knowledge of the market. A continuos state of preparedness has to be there on the part of the industry, he added
He said that the introduction of e-commerce has meant that not only have the production horizons of economic agents widened but there has been a significant reduction in transaction costs by removing the intermediaries.
Aggarwal, however, warned of the possibility that the e-commerce market may be cartelised which may lead to a loss of benefits of competition and transperency.
