| |AUGUST 202219By emerging out of such an adverse environment and looking at a GDP growth of more than eight percent, the Indian industry has proved its capability of resilienceSelf-sustenance in AgricultureThe biggest problem ailing the growth of the Indian fertilizer industry is the heavy dependency of the industry on imports of major input and finished products. For example, the urea sector contributes significantly to fertilizer production and consumption in the country. It accounts for 60 percent of the total fertilizer consumption and 50 percent of the total fertilizer imports in terms of volume. However, in order to ensure large domestic production, the Indian government in 2021 has taken the bold step of creating brownfield urea manufacturing plants through joint ventures (JV) founded by various Navaratna and Mini Ratna Public Sector Undertakings (PSUs). Ramagundam Fertiliser and Chemical (RFCL) is the first such joint venture, owned by Rashtriya Chemicals and Fertilisers (RCF), Engineers India (EIL), National Fertilisers Ltd (NFL), and FCIL. The factory is now operational, with an annual capacity of 12.7 lakh MT of urea. The RFCL factory is in Telangana's Karimnagar district. The Indian government has also encouraged the development of Hindustan Urvarak and Rasayan Limited (HURL), a JV business having main shareholders Coal India Ltd (CIL), NTPC, and Oil India Ltd (OIL), as well as minority owners HFCL and FICL. At Gorakhpur in Uttar Pradesh, Barauni in Bihar, and Sindri in Jharkhand, it is building three brownfield urea production operations. These three facilities are projected to cost above Rs.20,000 crores to build. The Gorakhpur facility was inaugurated by Prime Minister Modi in the first week of December 2021, and the other two units are slated to start generating much needed urea fertiliser in the first few months of 2022. Constant Turmoil in Steel IndustryThe steel industry has been in constant turmoil throughout 2021. Starting from labor shortage, deficiency of oxygen during the second wave to rising input costs; this year was indeed challenging for the segment. In April, a considerable dip in the total production was noted due to a lack of oxygen supply to the industries, making it difficult for the manufacturers to even run the plant. Additionally, the shortage of manpower exaggerated the events, as laborers went back to their homes during the second wave. However, the steel segment of India managed to overcome the issue and witnessed a 25.6 percent growth in crude steel production in the first eight months of 2021, according to a report from Infomerics Valuation and Rating. The government report added, "the declining imports and rising exports are an indicator of the country moving ahead in its pursuit of self-sufficiency or atmanirbhar". One of the main reasons for the increase in production is the much-needed government intervention. The government has been taking the necessary steps to ensure that the steel industry can continue to operate smoothly. The National Steel Policy (NSP) was implemented to encourage the industry's rapid development in order to meet worldwide benchmarks. This is significant since the eastern region of the country has the ability to add more than 75 percent of India's additional steel capacity. Over 200 MT of the 300 MT capacity is planned to come from this region by 2030-31.The Road AheadAs per reports till October, the combined Index of Eight Core Industries stood at 136.2 in October 2021, which increased by 7.5 percent (provisional) as compared to the Index of October 2020. "The production of Coal, Natural Gas, Refinery Products, Fertilizers, Steel, Cement and Electricity industries increased in October 2021 over the corresponding period of last year", the government stated. However, there are a number of persistent problems limiting the core segments from reaching the optimum growth. Issues like price hikes in steel, crude oil, and the refinery sector are some of the daunting issues that need to be dealt with in 2022.
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