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Rediff.com  » Business » Sleel industry wants govt to continue focus on core sector

Sleel industry wants govt to continue focus on core sector

May 18, 2009 16:38 IST

With the United Progressive Alliance government voted back to power, the steel industry wants the coalition to continue its efforts to revive the infrastructure sector and create overall demand in the economy.

"(The) government should work for infrastructure development to build up steel demand and lead India towards 100 million-tonne production capacity by 2011-12," Ispat Industries vice-chairman and managing director Vinod Mittal told PTI.

The UPA government has already come out with three stimulus packages in the last six months to give a fillip to the core sector, which has been hit by the global economic slowdown. It may announce another booster for the economy as part of the annual budget to be presented in July.

The Congress in its manifesto for the 15th Lok Sabha polls had said it will continue to focus on the core sector and bring in new steps to stimulate demand in the economy.

Even as a section of the industry wants the government to stimulate demand through a dossier of stimulus packages, JSW Steel joint managing director Seshagiri Rao felt the new administration should instead introduce a policy which asks banks to provide credit at lower rates.

"A stimulus package will add to our fiscal deficit. I think the government should rather work for a policy which asks banks to provide credit to the industry at lower interest rates," Rao said.

Steel major Essar Steel Business Group CEO J Mehra said the government should work on reviving the economy and protect the interest of the domestic industry, which will in turn lead to growth in the steel sector.

"Apart from focusing on the infrastructure sector, the government should promote exports. It should also prevent the domestic industry from cheap dumping of goods by way of imposing anti-dumping and safeguard duty," Mehra said.

As major steel companies like JSW, Essar and Ispat voiced for a continued government focus on the infrastructure sector to create demand for the commodity, secondary producers like Bhushan Steel sought a policy initiative aimed at raw material security for steel projects.

"The government should come out with a policy to provide big steel plants with raw material security, this should be exclusive of the present procedure. Also the government should work towards expediting regulatory approvals," Bhushan Steel managing director Neeraj Sinhal said.

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