New Delhi: A sustained government spending on infrastructure like roads, railways, power and housing will propel India into the league of top global steel consuming nations in the next 10 years, a top official of domestic steel giant SAIL has said.
"If you look at the massive infrastructure push by the government, even going by conservative estimates, steel demand will grow a lot. India will equal the global per capita consumption in 10 years," SAIL Chairman P K Singh told PTI.
Per capita steel consumption in India, the world's third largest producer of the metal, stood at 59.4 kg per person in 2014, against a global average of 216.6 kg, data from industry body World Steel Association showed.
The chief of India's largest steel producer added the country is at a "take-off stage" and all the "requisite ingredients" are in place, only a little push from the government was needed, which is now on its way.
"Look at the road sector, more highways are being built, which means more steel will be used. Similarly, in Railways more tracks are to be laid and we expect a huge jump in spending there. Power sector is also expanding, which again will boost demand for the metal," Singh said.
According to him, the government's 'Housing for all' is a novel initiative that will give impetus to steel demand. In automobiles too, demand is rising for commercial vehicles as well as passenger cars which will further aid steel sector.
According to a report by the Working Group on Steel for the 12th Five Year Plan period, the potential of raising per capita steel consumption in India is being supported by several factors.
An estimated infrastructure investment of USD 1 trillion, projected growth in manufacturing at 11-12 percent, rise in urban population, emergence of rural market for steel buoyed by projects such as Bharat Nirman, Pradhan Mantri Gram Sadak Yojana are prominent ones among them, it had said.
Singh, however, cautioned against the rising overcapacity in steel across the globe, especially in China.
"We have to be cautious about the excess capacity in the world and in China. Some countries are dumping their products in India at cheaper rates and adversely impacting the health of domestic producers.
Steel industry is of strategic importance and is the barometer of growth," he said.
India is the "only growth area" globally and everyone is trying to get a "share of this pie", Singh said adding that government needs to watch out for dumping of steel products so that domestic firms can participate with full vigour in the 'Make in India' programme.
He welcomed the imposition of a provisional minimum import price (MIP) on 173 steel products and hoped that government will continue with it beyond August, when it expires.
As per government data, steel imports declined by 41 percent to 0.546 million tonnes (MT) in May this year compared to the year-ago period. This was triggered by MIP and other measures like safeguard and anti-dumping duty.
In April too, steel imports were down 15.5 percent year- on-year at 0.654 MT.