Year-end Review-2022 Ministry of Steel

The Steel Sector plays a pivotal role in crucial sectors such as construction, infrastructure, automobile, engineering, and defense. Over the years the steel sector has witnessed tremendous growth. The country is now a global force in steel production and the 2^nd largest crude steel producer in the World.

Production and Consumption: – The production performance of the Steel sector during the first eight months of the current fiscal (April-November 2022) has been quite encouraging.  The domestic finished steel production stood at 78.090 million tons (MT) against 73.02 mt during the corresponding period last year which is 6.9% higher than CPLY. The domestic consumption was at 75.340 mt, which is 11.9% higher than the CPLY of 67.32 mt.   Domestic crude steel production stood at 81.96 mt and was up by 5.6% over the same period last year at 77.58 mt. 

Recent initiatives for the growth of the steel sector: –

(I)   Production Linked Incentive (PLI) Scheme:  PLI Scheme for domestic production of specialty steel has been approved with an outlay of Rs.6322 crore by the Cabinet. The five broad categories of Specialty steel, identified under the scheme, are used in a variety of applications including white goods, automobile bodies, and components, pipes for the transportation of oil and gas, boilers, ballistic and armor sheets, high-speed railway lines, turbine components, distribution, and power transformers. The Scheme has been notified on 29.7.2021 and detailed Scheme Guidelines were published on 20.10.2021. The application process through the online system was available from 29.12.2021 till 15.09.2022.

The scheme is set to commence from FY 2023-24 (PLI to be released in FY 2024-25).  67 applications from 30 companies have been selected under the Production Linked Incentive (PLI) Scheme for Specialty Steel. This will attract committed investment of ₹ 42500 Crore with downstream capacity addition of 26 million tonnes and employment generation potential of 70000.

(II)   Steel Prices:  Certain measures were taken by the Government to provide relief from prevailing high prices of crucial raw materials & intermediates, which included iron and steel. Accordingly, modifications were made in tariffs on raw materials of steel and other steel products vide notification dated 21.05.2022 whereby Import duty on Anthracite/Pulverized Coal Injection (PCI) coal, Coke, and Semi-coke, and Ferro-Nickel were reduced to zero. Export duty on Iron ores/ concentrates and iron ore pellets was raised to 50% and 45% respectively. In addition, a 15% export duty was imposed on pig iron and several steel products.

The prices of steel items declined approximately 15-25% across the board & stabilized consequent to the above measures. Now, taking into view the concerns of all stakeholders concerned, the said notification has been rescinded vide notification dated 18.11.2022, and the status prior to 21.05.2022 has been restored.

(III)   Decarbonization in the steel sector:  India’s steel sector accounts for 12% of India’s CO2 emissions with an emission intensity of 2.55 t CO2/TCS compared to the global average emission intensity of 1.85 t CO2/TCS. As a part of Glasgow’s commitments, India plans to achieve net zero emissions by 2070.

Ministry of Steel is continuously engaging with the stakeholders from the steel industry and the concerned stakeholder Ministries/ Departments such as the Ministry of Environment, Forests & Climate Change (MOEFCC), Ministry of Power, Bureau of Energy Efficiency (BEE), Ministry of New and Renewable Energy (MNRE), NITI Aayog, etc. Detailed discussions on decarbonization and improvement of resource efficiency in the Steel Sector were also held in meetings of Consultative Committees of Parliament on “Transition towards Low Carbon Steel-Green Steel on 6th May 2022” and “Roadmap for Circular Economy in Steel Sector on 1st July 2022”. Further, the Ministry of Steel hosted a session on the 6th Day of the COP 27 event in Sharm-El-Sheikh, Egypt on 11th November 2022 wherein discussions were held on the issues of reducing carbon emissions hinging on technologies such as green hydrogen in steel-making, Carbon Capture, Storage and Utilization (CCUS), Best Available Technologies on Energy Efficiency as well as transition to Renewable Energy.

(IV)   Brand India in the steel sector:   Ministry of Steel has undertaken the initiative of Made in India branding of Steel produced in the country. Major Steel Producers have been on board regarding the importance of Made in India branding for steel. Ministry of Steel held multiple discussions with all the Major Producers (ISPs), DPIIT & QCI regarding evolving a common criterion for Made in India branding and the parameters that need to be captured in the QR Code for branding. After extensive consultations, a common criterion has been finalized.

Initially, made-in-India branding will be started with a Pilot roll for a few selected products of SAIL & Jindal Stainless Limited. QCI is undertaking consultations with Jindal Stainless Limited and SAIL for creating an IT platform for the generation of QR codes for affixing on steel products. Once the necessary improvements are made in the platform for seamless operation, the rollout of the Made in India branding for steel shall be started on a wide scale with all the ISPs.

(V)  Quality control orders/BIS:   Government has been facilitating the supply of quality steel for critical end-use applications such as infrastructure, construction, housing, and engineering sector. Ministry of Steel is the leading Ministry with maximum coverage of products under the BIS certifications marks scheme.  A total of 145 Indian Standards on Steel & Steel products have been covered under Mandatory Quality Control Orders. These orders prohibit, the import, sale and distribution of substandard steel products. The imposition of QCO is in the public interest or for the protection of human, animal, or plant health, the safety of the environment, or prevention of unfair trade practices, or national security as stated in the BIS Act, 2016. Through the aforementioned orders, the Ministry of Steel has so far covered 99 Carbon Steel, 44 Stainless Steel & Alloy Steel products standards, and 2 Ferro Alloys under the mandatory BIS Certification scheme.

Further, to meet the requirement of container manufacturing, Indian Standard 11587 which was already under the purview of a quality control order was revised by BIS by including Corten Steel. And, the domestic steel manufacturers were urged to apply for BIS certification for the product.  Four domestic manufacturers have already been certified by BIS and domestic manufacturers are ready to supply the desired quality of Corten steel required by container manufacturers to reduce the dependency on the import of Corten steel and make the container manufacturing industry Atmanirbhar.

In addition, as per the data of imported steel grades shared with BIS, more than 250 new steel grades have been included in the existing standards and 5 new standards are under preparation. This exercise is facilitating the upgradation of the Indian Steel Standards at par with Global Standards. This exercise is also facilitating the indigenization of many of the imported steel grades for import substitution and make-in-India initiative.

(VI)   PM Gati Shakti National Master Plan: Ministry of Steel has on-boarded itself on the PM Gati Shakti National Master Plan Portal with the help of Bhaskaracharya National Institute for Space Applications and Geo-informatics (BISAG-N). It has already uploaded geo-locations of 1982 Steel Units functioning in the country. It has also uploaded all the iron-ore and manganese ore mines in the country.

In the directions of the Dept. for Promotion of Industry and Internal Trade (DPIIT), the Kalinga Nagar Steel hub has been taken up under PM Gati Shakti Area Approach. Ministry of Steel has also identified 22 critical infrastructure gaps and is pursuing it Ministry of Road Transport and Highways, Ministry of Railways, Ministry of Ports, Shipping and Waterways.

(VII)   Engagement with Secondary Steel Sector:  A major segment of the iron & steel industry is the segment of secondary producers which contributes more than 40% to the production of crude steel.  The role of the secondary steel sector in infrastructure development is immense.  Not only does infrastructure development provide a stimulus to steel demand but steel intensive construction also leads to rapid building up of infrastructure.  Considering the importance of this sector, which mostly consists of MSMEs, the Ministry of Steel organized a seminar under the chairmanship of the Hon’ble Steel Minister on 27th March 2022 in Vigyan Bhawan, New Delhi with aim of providing a platform to players in the Secondary Steel sector to share their views on the challenges faced by the sector and ways in which the Ministry can create an ecosystem in which the industry can thrive.

In the conference, fruitful discussions were held on topics viz. PLI Scheme, raw materials, green steel & renewable energy, etc.  The issues raised during the discussion have been taken up with concerned Ministries such as the Ministry of Finance, Ministry of Port, Shipping & Waterways, Ministry of Coal, Ministry of MSMEs, and Ministry of PNG.  Ministry of Steel also organized seminars at Bhuvneshwar, Indore, Roorkee, and Surat to interact with secondary steel producers and consumers to enhance steel demand in the country.

(VIII) Steel Minister’s Advisory Groups: With the approval of the Hon’ble Steel Minister, two advisory groups have been constituted namely, the Advisory Group of the Ministry of Steel for Integrated Steel Plants (ISPs) and Secondary Steel Industry (SSI) under the Chairmanship of Hon’ble Minister of Civil Aviation and Steel. The advisory groups aim at identifying common issues being faced by the industry and finding a way for their resolution with active participation from the Ministry.  Meetings, at regular intervals, are being held for both advisory groups. So far, five meetings of the advisory group for ISPs and three meetings of the SSIs have been held.

(IX)  State Minister’s conference:  A conference of Ministers of Industry/Mines/Steel of State Governments held on 15.11.2022 at Vigyan Bhawan, New Delhi under the Chairmanship of Hon’ble Steel Minister (HSM) to provide the State and Central Governments an opportunity to deliberate on matters related to issues in the mining of raw material, growth, and future challenges of the steel sector.   HSM urged the states to take all-out efforts towards (i) increasing rural consumption of steel; (ii) utilizing all grades of iron ore in steel-making; (iii) timely auctions of mines; (iv) formalization of the recycling industry and bringing to scrappage the End-of-Life Vehicles.

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