Help Desk -
9717405332, 9599714297, 9810335381
Email
Password

Steel industry to generates lot of employment in coming years – Ms Aruna Sharma

Steel News - Published on Wed, 03 Jan 2018

Image Source: millenniumpost.in
It is the start of a new year. In an interview with CNBC-TV18, Steel Secretary Aruna Sharma talks about the steel demand for the coming year. She said that Steel Authority of India Ltd planning to bid for some of the distressed steel companies in the National Company Law Tribunal is a completely commercial decision of the company and the ministry will not get into it.

She added that according to the policy of the government, we must give preference to steel make in India when we are consuming for the infrastructure.

Ms Sharma said that there is no compromise on quality, the agency has full authority to check the quality and accept only which is up to their standards.

According to her, Indian steel makers have to be efficient, there can be no cartelisation.

Steel industry gives a lot of indirect employment and gives sustainability to the products which are being made and is good for growth, she further mentioned.

Below is the verbatim transcript of the interview.

Latha - The morning woke up with headlines saying that Steel Authority of India (SAIL) is going to bid for some of the distress steel companies in the National Company Law Tribunal (NCLT) can you confirm that for us that you all will be buyers?

A - It is a completely commercial decision of the SAIL and definitely the ministry will not get into it. It is for the ministry to decide whether to invest or not to invest does not come into scenario at all. It is completely for the SAIL corporate, their board of directors who will take the intelligent decisions depending on their financial conditions and their own commitments and how they will like to go ahead in the market.

Sonia - Given that the financial conditions are not very good, I mean SAIL is sitting on huge amount of debt, high amount of interest payments etc. do you think that it would be hard for them to go ahead with buying out any of the stressed assets?

A - It is not appropriate from ministry to comment in either way at this moment of time. Let them go ahead and work upon it. There are many competitors and the scenario for bidding has not yet started. So, let us reach the bridge then we will see how to cross it.

Latha - The other issue for which we invited you is that you protested when railway ministry put out a global tender?

A - It is a policy of the government that we must give preference to steel make in India when we are consuming for the infrastructure so whether it is central government or whether it is state government or whether it is the agencies of the government. So, under that it is very important and let me underline it very clearly that there is no compromise on quality. Their agency has full authority to check the quality and accept only which is up to their standards.

Similarly, the other new entrants the Indian maker entrant which has gone is being subjected to rigorous test by Research Designs and Standards Organisation (RDSO) which is again a railway authority. The advantage is that in India we can give them long rails. Long rails are very difficult to transport. So, in case they import they will have to compromise with the shorter length for rails and whatever capacity is there whatever is the policy of the government as well as the opportunity to give to the new entrants and development contracts, I think we have been working within that brackets and that scenario.

It is something that Yes they have to compete in quality, they have to compete in their rates, they have to compete in their supply chain, they have compete in ensuring that they withstand their commitments. So, absolutely no protection, it is something like a little preference which is as per the policy of the government.

Latha - You said that you will not compromise or railways will not compromise on quality but what about price? I mean a global tender is primary elicited not just to get best quality but best price.

A - I totally agree to what you say it will enable us to understand the price.

Latha - So you will force the Indian supplier also to match the global price?

A - Yes, there is a Department of Industrial Policy and Promotion (DIPP) policy on that so absolutely no issue on it. Indian steel makers have to be efficient. They can’t be exploitative. You have seen us taking a similar stand when under the same policy the GAIL contracts were finalised, so absolutely no cartelisation, absolutely no exploitation by Indian steel manufacturers. Absolutely, they produce excellent quality no doubt about it. The agencies of the railways or any of these procurement agencies which test the quality is absolutely efficient and most important is that the efficient making of steel is there, so they can’t be pricing at much higher than what is possible to import. So they will have to compete their prices and reach that level.

Latha - I am asking you, I am not saying it is done deal? I am asking you whether the domestic guy is going to be a preferred. Yes, no compromise on quality, but will he be preferred even if he is a pricier, more expansive than the global competitor?

A - If he is targeting profiteering, answer is a NO. If there is a little difference than it is the decision maker who is procuring has to decide, so definitely they cannot be exploitative and we have given evidence in the GAIL tenders?

Latha - If the price is 10 percent higher say from the Indian supplier?

A - I am no body to decide what percentage higher, there is a reasonability clause whenever any tender is finalised and it has to be reasonable. After all you are going to trigger the employment in this country. It is going to grow the whole gross domestic product (GDP) and it is going to prefer there is no logic, every country does that. I don’t think so that you are doing something which is out of the business and India needs it.

See After all we need a growth by the steel makers, we need a growth in the infrastructure, we need a growth in the employment and steel gives lot of indirect employment and most important is it gives sustainability to the products which are being made. So, I think it is a good bargain. For a Nation also I think it is a wonderful bargain.

Sonia - Just wanted to ask you what the update is as far as SAIL’s business is concerned? Last time we spoke to you said that SAIL will see a turnaround and turn profitable very quickly? In terms of a timeline what are we looking at?

A - I think 2018-2019 or may be the calendar year 2019 itself should bring the good news. We have made an experts committee in the ministry and we have some experts who are doing literally nuts and bolts supervision. Then Boston Consulting Group (BCG) has been appointed by the board of directors of SAIL which has again given what to do, when, where and how kind of things and that is also being monitored and the whole shop floor people are directly involved. They are working hard towards it.

In this financial itself you will see them bringing down their loss considerably and they had a little cash profits. So, that is excellent at least the direction is correct. So, this calendar year we are hopeful that we will hear the good news.

Sonia - You mean FY19 right?
A - Yes, financial year 2018-2019 yes and maybe by December 2018 itself that quarter itself will start showing good results.

Source :

Posted By : Nanda Koijam on Wed, 03 Jan 2018
Related News from Steel segment