Steel production in India registered positive growth in the first quarter of fiscal 2009-10, due to strong demand in domestic market and higher infrastructure spending by the government.
According to Steel Secretary P K Rastogi, steel output of India surged 3.4% in first quarter of fiscal 2009-10 in comparison of the first quarter of fiscal 2008-09, reported Central Chronicle on July 8, 2009.
Steel consumption in India went up by 5.3% during April-June 2009 as compared to April-June 2008. Moreover, India was ranked the third largest steel producer in the world after China and Japan during January-May 2009. Anticipating a major recovery, the steel minister projected 6-8% growth for the steel industry during fiscal 2009-10.
Strong domestic demand and increased infrastructure spending by the government will help steel industry to witness growth in fiscal 2009-10. Steel consumption will also keep on rising this fiscal year in wake of various monetary, fiscal and administrative initiatives taken time-to-time by the Indian government.
Financial crunch, coupled with high cost of input, severely affected the profits of steel companies. However, the increased spending by the government is expected to push up the domestic consumption, thereby boosting the steel industry.
Apart from this, the government has restricted the iron ore exports to other countries, including China, so as to enable the optimal use of steel by domestic steel makers. The exports of ore will only be encouraged in the value-added form.
The government said, "The emphasis of the future steel policy of the government would be to discourage and restrict exports of iron ore just as China reserves its iron ore for its own industry and US continue to preserve reserves of its crude."
A recent research report "Indian Steel Industry Outlook to 2012" by RNCOS says that Indian steel industry has emerged as one of the reputable steel industries in the world as it is rapidly gaining the pace, attracting steel giants from across the globe.
According to a Research Analyst at RNCOS, "The Indian steel industry is taking a boost from the sectors like construction, infrastructure and automobile. Moreover, the budgetary allocation for the infrastructure sector will further support the growth of steel industry. Therefore, there is enormous scope for the country's steel industry in coming times."
Related Market Research Reports:
Indian Steel Industry Outlook to 2012
US Steel Industry Outlook
UAE Steel Industry Analysis
