Steel sector in India to seek help from a consultancy to turn things around

Like every other industry today, the steel sector in India is no stranger to the havoc created by coronavirus pandemic.

Importance of the steel sector in India can be attributed to the fact that it contributes about 2% to India’s GDP. It also employs over 5 lakh people in India. The government, therefore, intervened to revive the distressed steel sector. It is engaging a consultancy firm to chalk out an action plan for the domestic steel sector’s revival.

The Steel Ministry steps forward

The COVID pandemic has mainly impacted production, demand, and supply of steel and many steel plants are operating at a lower capacity. The Steel Ministry is determined to study and solve such issues that have cropped up due to the pandemic. The ministry has also asked the stakeholders to brainstorm on the issues and has assured to extend any resort possible.

Additionally, it has given various relaxations to the players across the sector. Additionally, the ministry has issued RFP (request for proposal) to appoint a consultancy firm to prepare a detailed action plan.

Suggestions by the CII

Earlier the Confederation of Indian Industry (CII) had recommended a slew of measures for reviving the growth of the domestic steel sector. CII suggested time-bound implementation of infrastructure projects to enhance demand along with a ban on imports of seconds, defective and re-rollable scrap steel.

Other recommendations by CII were about raw material security for steelmakers, improvement of supply chain disruption, facilitation of steel & raw material movement, managing cash flow, etc.

An accelerated path to steel sector revival

Now with the RFP issued by the Steel Ministry, the Steel sector revival will accelerate with the detailed action plan. The firm will be responsible to identify challenges arising out of the global pandemic and its impact on the supply chain, demand, supply, and logistics. The plan has to be developed and implemented within 12 months of signing the contract.