In the absence of new investment, brownfield projects in the domestic steel industry must receive the central government’s corporate tax cut, said VR Sharma, managing director of Jindal Steel and Power Ltd (JSPL).
“We call on the central government to extend the tax cuts to industrial projects,” said Kumar on Friday at a webinar by CARE Ratings. “Steel mills take two to five years to start production. JSPL, JSW, SAIL, ArcelorMittal and others have brownfield projects but no new investments have been made recently. “
On Thursday, the World Steel Association (WSA) announced in its short-term outlook that Indian steel demand is expected to increase by 19.8 percent in 2021. This is the largest increase among the major consumer countries. “India will need 300 million tons of steel by 2030. Our production capacity is currently 100 million tons,” said Sharma.
Increased government spending on infrastructure as part of the Covid-19 recovery surge is increasing steel demand in India and around the world, he added. “This burst of potential came about through government spending, not personal and public spending.”
Steel prices have also risen sharply in recent months, adding pressure to consumer industries such as real estate and automobiles. However, domestic steel prices are at least $ 200 per ton lower than the export price, Kumar said.
In the first eleven months of the business year just ended, exports of finished steel rose by 22 percent year-on-year to 9.5 million tons. On the other hand, according to the Steel Ministry’s Joint Plant Committee, imports fell by 9 percent to 4.3 million tons.