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Annual Report 2008-09

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Annual Report 2008-09 lR;eso t;rs MINISTRY OF STEEL GOVERNMENT OF INDIA ANNUAL REPORT 2008-2009 lR;eso t;rs MINISTRY OF STEEL GOVERNMENT OF INDIA www.steel.gov.in Chapter C O N T E N T S Page No. I HIGHLIGHTS 04 II THE INDIAN STEEL SECTOR : DEVELOPMENT AND POTENTIAL 12 III ORGANISATIONAL STRUCTURE AND FUNCTIONS OF THE MINISTRY OF STEEL 24 IV PUBLIC SECTOR 33 V PRIVATE SECTOR 50 VI RESEARCH AND DEVELOPMENT 58 VII ENERGY AND ENVIRONMENT MANAGEMENT 70 VIII DEVELOPMENT OF INFORMATION TECHNOLOGY 84 IX SAFETY 90 X SHIP BREAKING 96 XI WELFARE OF WEAKER SECTIONS OF SOCIETY 99 XII VIGILANCE 111 XIII GRIEVANCE REDRESSAL MECHANISM 119 XIV IMPLEMENTATION OF PROVISIONS OF 125 PERSONS WITH DISABILITIES ACT, 1995 XV PROGRESSIVE USE OF HINDI 133 XVI EMPOWERMENT OF WOMEN 139 XVII NEW INITIATIVES / INNOVATIVE SCHEMES 145 XVIII RECOGNITION AND AWARDS 154 XIX PROMOTION OF STEEL USAGE 160 XX CORPORATE SOCIAL RESPONSIBILITY 164 XXI TECHNICAL INSTITUTES UNDER THE MINISTRY OF STEEL 174 XXII IMPLEMENTATION OF THE RIGHT TO INFORMATION ACT, 2005 176 XXIII DEVELOPMENT OF NORTH-EASTERN REGION 180 ANNEXURES 184 The production, financial and other related figures for 2008-09 are provisional. Dr. Manmohan Singh, Hon’ble Prime Minister, laying the foundation stone for Modernisation & Expansion of SAIL’s Salem Steel Plant on September 5, 2008, in the august presence of Smt. Sonia Gandhi, Hon’ble Chairperson, UPA. Also seen in the picture are other prominent dignitaries (from left to right): Shri GK Vasan, the then Hon’ble Minister of State for Statistics and Programme Implementation; Smt. Subbulakshmi Jagadeesan, the then Hon’ble Minister of State for Social Justice and Empowerment; Shri Mani Shankar Aiyar, the then Hon’ble Union Minister for Panchayati Raj and Development of North East Region; Shri KV Thangka Balu, the then Hon’ble Member of Parliament, Salem; Shri Ram Vilas Paswan, the then Hon’ble Union Minister for Chemicals & Fertilizers and Steel; Shri PK Rastogi, Secretary (Steel), Govt of India; Shri SK Roongta, Chairman, SAIL; Dr. Anbumani Ramadoss, the then Hon’ble Union Minister for Health and Family Welfare; Shri TR Balu, the then Hon’ble Union Minister for Shipping, Road Transport and Highways; Shri Jitin Prasada, the then Hon’ble Union Minister of State for Steel; Shri Veerapandi S. Arumugam, Hon’ble Minister for Agriculture, Tamil Nadu; Dr. K. Ponmudi, Hon’ble Minister for Higher Education, Tamil Nadu and Shri BB Singh, Executive Director, SAIL’s Salem Steel Plant. CHAPTER-I HIGHLIGHTS STEEL SECTOR TRENDS India remained the fifth largest producer of crude steel in the world during 2008. India also maintained its lead position as the world’s largest producer of direct reduced iron (DRI) or sponge iron with nearly 20 million tonnes production in 2008-09. As per the revised estimates, the country is likely to achieve a steel production capacity of nearly 124 million tonnes by the year 2011-12. The steel sector is expected to generate additional employment of around 4 million by 2020 for production of around 295 million tonnes of crude steel by 2019-2020. 222 MoUs have been signed with various States for planned capacity of around 276 million tonnes. Major investment plans are in the States of Orissa, Jharkhand, Chattisgarh, West Bengal, Karnataka, Gujarat and Maharashtra. The details of the break-up of the MoUs signed by the State Governments of Orissa, Chattisgarh, Jharkhand and Other States are given in the table below: State No. of MoUs Capacity signed (in million tonnes per annum) Orissa 49 75.66 Jharkhand 65 104.23 Chattisgarh 74 56.61 West Bengal 12 21.00 Other States 22 18.20 Total 222 * 275.70 * approximate Highlights of 2008-09 Crude steel production was at 54.52 million tonnes, a growth of 1.23% over last year with capacity utilisation at 89% during the year. It grew at more than 9% annually from 38.72 million tonnes (MT) in 2003-04. Production for sale of total finished steel was at 56.39 million tonnes, a growth of 0.6% as compared to last year. As against 40.71 MT in 2003-04, an average annual growth of 7.3% was registered. Total finished steel exports decreased by 26 % as it reached an estimated 3.75 million tonnes while imports were at an estimated 5.77 million tonnes, a decline of 18 %. At 51.85 million tonnes, domestic consumption of total finished steel declined marginally by 0.53%. The growth was driven by capacity expansion from 43.91 million tonnes per annum (MTPA) in 2003-04 to 64.40 MTPA in 2008-09. The induction furnace route accounted for 32% of total crude steel production during 2008-2009. The total financial requirements covered in Demand No.91 of the Ministry of Steel for Budget Estimate (BE) 2008-09, Revised Estimate (RE) and Actuals for 2008-09, are summarised in the following table: 4 (Rs. in crore) Demand BE 2008-09 RE 2008-09 Actual 2008-09 No. 91 Plan Non-Plan Total Plan Non-Plan Total Plan Non-Plan Total Revenue 18.50 85.52 104.02 18.49 488.61 507.10 0.00 480.78 480.78 Section Capital 15.50 0.00 15.50 7.51 260.04 267.55 0.00 260.04 260.04 Section Total 34.00 85.52 119.52 26.00 748.65 774.65 0.00 740.82 740.82 A view of Wire Rod Mill at SAIL’s Bhilai Steel Plant. Major initiatives taken by the Ministry of Steel The Inter Ministerial Group (IMG), under the Chairmanship of Secretary (Steel) has been conducting regular review and coordination meetings with the steel investors, Central Ministries/Departments and the State Governments concerned. During the year, review meetings with investors (July 2008 and September 2008), a meeting with State Government (May 2008 at Bhubaneswar) and two coordination meetings with Central Ministries and State Governments (October 2008 and December 2008) were held. Steel Quality Control Orders to ensure availability of 17 critical steel products of certified quality to consumers were issued during 2008. The order has since been revised subsequently whereby three products have been excluded and implementation of the order on 8 products have been deferred. Around 127 CDM projects from the iron and steel plants in India have been accorded Host Country Approval (HCA) by National CDM Authority in India. These projects will result in Green House Gas abatement worth 99 million tonnes of CO2 equivalent, resulting in generation of 99 million tonnes of Certified Emission Reduction (CER) till the year 2012 which can be traded in the International Market for earning substantial foreign exchange. Action taken to control inflation in the steel sector Government took the following measures to contain steel prices to control inflation during the period April-June 2008: 5 Reduction in Custom Duty in respect of non-alloy steel products and Zinc, Metcoke and Ferro alloys. The Counter Vailing Duty (CVD) on TMT rods and bars was reduced from 14% to NIL. Export duty was imposed on the following steel categories w.e.f. May 10, 2008: Export Duty of 15% on Pig iron, sponge iron, steel scrap, steel ingots, and all categories of non-alloy semi-finished steel Export Duty of 15% on non-alloy Hot Rolled (HR) steel Export Duty of 10% on non-alloy Cold Rolled (CR) steel Export Duty of 5% on non-alloy Galvanised and Coated steel Export Duty of 10% on bars, rods, wire rods, angles shapes Export Duty of 10% on pipes and tubes Export duty was modified on June 13, 2008 as follows: Export duty in respect of flat steel products was reduced from previous levels to NIL Export duties on bars and rods of non-alloy steel increased from 10% to 15% An ad-valorem export duty of 15% levied on iron ore of all categories and grades Action taken to control demand and supply of steel Action taken in October-November 2008 consequent upon the global financial crisis: Export duty on steel exports withdrawn w.e.f. October 31, 2008 Duty Entitlement Pass Book benefit restored on steel exports w.e.f. November 14, 2008 Import duty @ 5 % imposed on import of non-alloy steel (except melting scrap) w.e.f. November 18, 2008 Excise duty on steel products reduced from 14 % to 10 % w.e.f., December 07, 2008 Excise duty on steel has been further reduced to 8 % on February 24, 2009 Action taken to facilitate conservation of iron ore resource As a result of consistent efforts of Ministry of Steel, export duty on iron ore was imposed. Imposition of Export duty on iron ore has been an important step for enhancing raw material security for the domestic steel industry. Following rates of duty were imposed on iron ore exports in the Finance Bill 2007-08: Iron ore fines (iron content upto 62%) — Rs. 50 Per Metric Tonne (PMT) Iron ore fines (iron content 62% and above) — Rs. 300 PMT Iron ore lumps (all sorts) — Rs. 300 PMT Iron ore concentrates (all sorts) — Rs. 300 PMT The matter of export of iron ore was further deliberated by a Group of Ministers (GoM) constituted to consider the National Mineral Policy. In the GoM meeting to consider National Mineral Policy, there was an agreement that iron ore resources of the country should be conserved for the use of domestic steel industry. It was decided that although conservation of iron ore resources of the country is of paramount importance, the same may not be achieved by banning or capping the export of iron ore but by taking recourse to appropriate fiscal measures.
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