Atmanirbharta: Manufacture of a case for stainless steel

By Aruna Sharma

Stainless steel has a niche use, different from carbon steel. It can also trigger growth in the industrial sector. For example, we can think of switching to stainless steel pipes for the drinking water network; likewise, for long-term rustproofing in infrastructures.

India has a capacity to produce 50 lakh tons of stainless steel apartments. Per capita consumption is only 2.5 kg, compared to a global average of 6 kg per capita. One third of the stainless steel manufacturing capacity is in the MSME sector and two thirds between the private sector (such as Jindal Stainless, Shah Alloys, Rimjhim, BRG and Valley Iron) and the public sector (Salem Stainless Steel plant). by SAIL). Surprisingly, they are all only operating at 60% of their capacity, not because of low demand, but because of the dumping that imports resort to, especially from China.

The MSMEs, with a capacity of 14 lakh tons, do smelting and hot / cold rolling to produce steel mainly for domestic use (utensils, etc.). The use of stainless steel in the supply chain of the drinking water distribution network reduces water leakage by 24%; it is also literary maintenance free and is not carcinogenic. With the current focus on expanding drinking water infrastructure, it is important to choose the right material. In addition, stainless steel is widely used in the automotive, railroad and transport sectors, and is a major capital good in the dairy, chemical, pharmaceutical, agrifood, and food processing sectors. water, as well as in nuclear units. It also finds use in elevators, razor blades, surgical instruments, and artificial light limbs for the disabled. India is clearly on a low stainless steel use curve.

The challenge is twofold. One, to increase consumption from 2.5 kg to 6 kg per capita, and two, to ensure the confidence of manufacturers to improve their capacity. A tariff structure must be in place to ensure that dumping is minimized and that high nickel stainless steel does not end up in Indian markets. The government is aware of this and the Bureau of Indian Standards guarantees quality standards not only for imports but also for domestic products.

The recent announcement of the suspension of countervailing duties (CVD) on certain stainless steel products from China and Indonesia has hurt the industry, curtailing expansion plans to become atmanirbhar. The immediate need is to have a holistic approach to the stainless steel sector by increasing its use in all industries. To trigger new investments, it is necessary to lift the suspension of countervailing duties on China and also to have countervailing duties on Indonesia.

It is a misnomer that the price of stainless steel from Indian companies is higher, as it goes hand in hand with the increase in the prices of raw materials (mainly imported) and the world price. This is low margin manufacturing and any jerk with sudden policy changes negatively affects the indigenization and quality control in stainless steel manufacturing. In summary, increase the use of stainless steel and make sure that no spillage occurs.

The author is a practicing development economist and former secretary, GoI