India would require to double its iron ore mining capacity by 2030 in order to meet demand as per the NSP 2017, feels NITI Aayog member V K Saraswat.
With respect to steel, he said that growth in infrastructure, power industry, cement industry would the real trigger for growth while attractive chances arising through the PLI scheme, policy support for MSMEs etc are driving the demand for steel, Saraswat said at a webinar organised by Indian Chamber of Commerce.
“Domestic production has gone up by 13% in the
last five years from 129 million tonne in 2015 to 206 million tonne in 2019 at a CAGR of 12.4%. In terms of consumption, it has gone up from 115 million tonne in 2014-15 to 160 million tonne in 2019. Major efforts are being made towards achieving the goals of NSP by 2030-31,” he stated.
However, he pointed out that overall, the segment faces severe challenges in cost competitiveness owing to high royalty and low import duty. Saraswat opined that even after three years of the auction procedure no large mine granted through auction process no large mine granted through auction has been able to commence production. Only 53 mines have been auctioned till date and three mines have been able to begin production. There are major issues of cooking coal, logistics infrastructure, land acquisition, increased necessity for consent, increase in compensation, not upgrade in technology.
However, he is optimistic that with all modifications and changes brought about by the government and industry together by 2050, almost one fifth of the steel produced globally will come from India compared to around 5%today.
India is already the world’s second largest steel producing country and it is likely to increase its annual production volume buy an amount almost twice that of Europe by 2050.
