New Delhi: India's steel consumption grew by just 3.3 percent in 2012-13 fiscal to 73.3 million tonnes as demand remained subdued almost throughout the year due to slackening economy and high interest rates.
The dip in consumption growth is the lowest for at least three years. It grew by 5.5 percent in 2011-12 over 2010-11 and 9.9 percent in 2010-11 over 2009-10, according to data complied by Joint Plant Committee, a body under the Steel Ministry.
The latest data showed India's consumption of steel, used mainly in construction and consumer durables, grew by 2.3 million tonnes from 71 million tonnes a year ago.
Total production expanded by a mere 2.5 percent during 2012-13 at 75.5 million tonnes from 75.6 million tonnes in 2011-12.
An industry expert said the decline in consumption led almost all major steel firms to resort to curtailing capacity utilisation.
"The consumption of steel is a factor of many things. It depends on the growth of the economy. A sound economy ensures higher consumption. User industries such as construction and consumer durables had a bad run last fiscal. This resulted the dip in demand," he said.
A stubbornly high inflation and Reserve Bank's tight monetary policy forced consumers to postpone decision leading to slackening in demand for steel, he added.