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Paswan asks steel industry to help in taming inflation

NEW DELHI: Steel Minister Ram Vilas Paswan on Wednesday asked the steel industry to continue supporting the Government in its efforts to tame inflation.

In his inaugural address at the ‘India Steel Conclave’ here, Mr. Paswan noted that while the Government did not want the industry to suffer and was concerned over the rise in raw material costs, steel producers must also ensure that their profit levels were not disproportionate to the rise in the cost of production so as to strike a fine balance between the interests of the consumers and the industry.

The Indian steel industry, Mr. Paswan said, was set to emerge as the third largest steel producer in the world by 2015, provided all the expansion programmes were implemented in a time-bound manner.

To ensure this, the Ministry, he said, was closely monitoring the major investment projects, including those in the public sector, through an Inter-Ministerial Group (IMG) functioning under the chairmanship of the Steel Secretary since last year.

Speaking at the inaugural session, Steel Secretary R. S. Pandey highlighted the various steps taken by the Government to help steel-makers reduce the cost of production. These included the cut in excise duty, the withdrawal of customs duty on scrap imports and the levy of 15 per cent ad valorem duty on iron ore exports.

The Government and the industry, Mr. Pandey said, would have to find a way to tackle the price spiral. For this, the industry should decide on a point of balance between the need of the consumers and price expectation of producers.

Even as the Government sought the steel industry’s continued support in taming inflation, Tata Steel Managing Director B. Muthuraman on Wednesday hinted at the possibility of a price revision saying that the current prices of steel were not sustainable owing to the soaring raw material costs.

Participating in the ‘Indian Steel Conclave’ here, Muthuraman pointed to the unprecedented hike in the cost of raw materials and ocean freight coupled with the robust demand for steel which were driving up its prices.

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