sponge iron industry –past-present-future - SIMA
sponge iron industry –past-present-future - SIMA
sponge iron industry –past-present-future - SIMA
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CHAIRMAN<br />
V S BAPNA<br />
VICE CHAIRMAN<br />
B L AGRAWAL<br />
EXECUTIVE DIRECTOR<br />
S S BHATNAGAR<br />
GOVERNING BODY<br />
V S Bapna<br />
B L Agrawal<br />
N K Patnaik<br />
Suresh Thawani<br />
G K Chhanghani<br />
Rajesh Gupta<br />
Sushil Maroo<br />
P L Mohanty<br />
P Mohanty<br />
T Srinivasa Rao<br />
V Ramachandran<br />
Prakash Tatia<br />
Narayan Tekriwal<br />
Amitabh Mudgal<br />
S S Bhatnagar<br />
EDITORIAL<br />
The Indian economy has been growing from strength to<br />
strength and is expected to grow by 9% in 2010-11<br />
against 6.7% in 2008-09 & 7.4% in 2009-10. It is<br />
encouraging to see <strong>future</strong> projections that the economy<br />
shall continue to be robust and grow in double digits in<br />
the next few years.<br />
All indicators and authentic data show that the demand<br />
for steel will substantially grow from Infrastructure,<br />
Construction, Automobile & White goods sectors. These<br />
are all on an upswing and are supporting the consumption<br />
and demand of steel which is projected to steadily and<br />
strongly rise. Though the statistics forecast a promising<br />
<strong>future</strong> for the Indian Sponge Iron Industry, the ride may not be so smooth in the<br />
near to long term.<br />
In 2010,the Sponge Iron Industry faced unprecedented problems and struggled<br />
with sharp input cost increases with unmatched selling prices thereby putting<br />
tremendous pressure on the financial viability of most units. The situation has not<br />
changed much. The supplies of vital inputs namely Iron Ore, Coal and to some<br />
extent Natural Gas have been affected both in terms of availability & prices. To<br />
add to the hardships of Sponge Iron Manufacturers, poor infrastructure support is<br />
also increasing costs thereby putting further pressure and affecting the bottomline.<br />
We all know India has sufficient Iron Ore & Non Coking Coal based on which huge<br />
investments were made and large number of coal based units were established<br />
thereby making India the largest producer of <strong>sponge</strong> <strong>iron</strong> in the world. These<br />
inputs have now become a matter of serious concern. No doubt availability of<br />
natural gas is expected to improve in next 3-4 years but effective pricing policy<br />
here will play a very important role.<br />
The Indian Sponge Iron Industry is a very cost effective, efficient and high<br />
performance sector which is now passing through very critical times. With no clear<br />
cut policy initiatives from the Government for the sustained supply of the essential<br />
inputs, survival of the Industry is at stake, to meet the fast growing demands of<br />
quality metaliks by secondary steel sector in terms of National Steel Policy.<br />
<strong>SIMA</strong> has been regularly taking up the hardships being faced by the Industry with<br />
the Government authorities who are fully aware of the situation. However on this<br />
front very little has been done by the government to ensure raw materials availability<br />
in adequate quantities & affordable prices particularly Iron Ore.<br />
We are confident that with constant re<strong>present</strong>ations and through regular high level<br />
interactions, the Government will have to take some positive measures to give the<br />
much needed boost to the <strong>sponge</strong> <strong>iron</strong> sector which is the backbone of the<br />
secondary steel production.<br />
A study is being done by Ernst & Young on <strong>future</strong> sustainability of the Industry in<br />
collaboration with Tata Sponge. The report is likely to be ready by February, 2011<br />
and shall bring to light lot of facts for the consideration of the members and for<br />
making further recommendations to the Government.<br />
We sincerely hope that as in the past with your active participation and full support<br />
to <strong>SIMA</strong> the year 2011 shall usher in new prospects and prosperity.<br />
Wishing you and your family a very happy, bright, prosperous and fruitful<br />
business like 2011.<br />
S S BHATNAGAR