Cabinet approves new policy: Govt agencies to use 'made in India' steel
The Cabinet on Wednesday approved a policy for providing preference to domestically manufactured iron and steel products in procurement by the government and its agencies.
The development assumes significance as it is likely to raise domestic steel consumption, as the country's per capita steel usage at 61 kg is much lower than the global average of 208 kg.
"The Cabinet on Wednesday approved a policy for providing preference to domestically manufactured iron and steel products in procurements by the government and its agencies," a source privy to the development said.
The policy aims at giving priority to domestically produced steel and value addition done in India, the source said.
The government had earlier said it was mulling making domestic steel use binding for government projects.
"Talks are going on with the ministries concerned for introduction of policy to make it mandatory to use India-made steel for all infrastructure and construction projects of the government," Steel Minister Chaudhary Birender Singh had earlier said.
The country's steel production and consumption are likely to be higher in 2017-18, backed by an increase in infrastructure allocation in the Budget, a report had earlier said.
Meanwhile, the Cabinet on Wednesday approved a new policy that envisages Rs 10 lakh crore investment to create more capacity in the steel sector.
"The Cabinet on Wednesday approved the National Steel Policy 2017," a source privy to the development said.
The development assumes significance as the steel sector is reeling under weak demand and rising raw material prices.
The policy aims at increasing supply of domestic coking coal to cut dependence on imports by half and production of 300 million tonnes of the alloy by 2030-31.
The ministry had earlier said the policy is a step towards steering the industry to achieve its future potential and strategy to deal with various impediments like high input cost, availability of raw materials, dependency on imports, financial stress etc, it added.
The policy also looks at increasing per capita steel consumption to 160 kg by 2030-31 and encouraging the industry to be a world leader on energy and raw material-efficient steel production by 2030-31 in a safe and sustainable manner.
The proposed policy looks to "develop and implement quality standards for domestic steel products".
In 2015, India was the only large economy in the world where steel demand continued to show a positive growth at 5.3 per cent as against China's (-)5.4 per cent and Japan's (-) 7 per cent.
India's growing urban infrastructure and manufacturing sectors indicate that demand is likely to remain robust in years ahead.