Chairing the meeting of the Parliamentary Consultative Committee attached to his Ministry here today, he said that steel remains critical for growth and development of our economy with its significant contribution towards infrastructural development and industrial base. He said that during January – December 2010, India has been placed as the fifth largest producer of crude steel in the world. India is also the largest sponge iron producer in the world since 2002.

Shri Verma said that while Indian economy posted near 9% growth each in both first and second quarters of 2010-11, for the first eight months of the year, i.e. April - November 2010-11, consumption of total finished steel recorded a robust 7% growth while production for sale during April - November 2010-11 has increased by 7.3%.

The Minister hoped that in the next five years, demand of steel is likely to grow at a higher annual average growth of over 10% as compared to the average annual growth of 8% achieved between 1991-92 and 2009-10. He said that in order to meet the growing demand 222 MoUs have been signed with various States for planned capacity of around 276 million tonne by 2019-20. Major investment plans are in the States of Orissa, Jharkhand, Karnataka, Chhattisgarh and West Bengal. This is likely to result in an investment of Rs. 8,70,640 crore by 2020. Capacity for crude steel production expanded from 51.17 million tonne per annum (mtpa) in 2005-06 to 72.96 mtpa in 2009-10, the minister added.

Shri Verma said that the Steel PSUs are in the midst of ambitious expansion plans. The major thrust of the modernization and expansion plans is to adopt the best modern technology, which in addition to being cost effective should also be energy efficient and environment friendly.

The Steel Minister informed that the expansion plans would increase the capacity of SAIL from 12.84 million tonne (in 2006-07) per annum crude steel production to 21.40 million tonne in the first phase to be completed by 2012-13, at an estimated cost of around Rs. 70,000 crore, which includes Rs. 10,000 crore for mine development. The first of the new capacities of SAIL to come up is at the Salem Steel Plant which has been completed by September 2010, he added.

He said, Rashtriya Ispat Nigam Limited (RINL) is at an advanced stage of commissioning its crude steel capacity expansion project from 2.9 million tonne to 6.3 million tonne per annum. The project is likely to be completed by 2011-12 at an estimated cost of Rs. 12,228 crore.

The Minister said that National Mineral Development Corporation (NMDC) has signed an MoU with the Government of Chhattisgarh for setting up a green field integrated steel plant of 3 million tonne per annum capacity in Nagarnar, Chhattisgarh with an estimated cost of around Rs. 15525 crore. NMDC in December, 2010 has signed an MoU with Severstal – a Russian Steel Company for setting up a 2 Million Tonne steel plant in Karnataka.

The Steel Minister said that RINL has under consideration a long term directional plan to increase the capacity to 20.0 million tonne by 2020-21 to be implemented in phases. During 2010-11 (April-December, 2010) production in major units exceeded 100% capacity utilization for the ninth consecutive year by achieving 110%, 110% and 111% capacity utilization for hot metal, Liquid steel and Saleable steel respectively.

The Minister was concerned that RINL is the only PSU that does not have captive iron ore and coking coal mines and this is a major factor affecting the company’s competitiveness. He said that RINL has been making efforts for acquisition of mines since 2003 and submitted 20 Prospecting Licenses / Mining lease applications out of which 10 were made during 2010 for iron ore in the States of Orissa, Chhattisgarh, Andhra Pradesh, Rajasthan and Jharkhand. RINL has been very actively exploring various options to ensure its raw material security through acquisition/Joint Venture route.

Some of the members, while appreciating the Corporate Social Responsibility work of the PSUs asked them to perform social responsibilities in the field of health, safe drinking water and education seriously.

Members of Parliament who attended the meeting are: S/Shri Gorakhnath Pandey, Capt. Jai Narain Prasad Nishad, Jeetendra Singh Bundela, Naranbhai Kachhadia, Shivarama Gouda and Yashbant N.Singh Laguri from Lok Sabha and S/Shri Nandi Yellaiah, Naresh Chandra Agarwal, Ramdas Agarwal, Shri Sabir Ali and Tapan Kumar Sen from Rajya Sabha.

The topic of the meeting was “Functioning of Rashtriya Ispat Nigam Limited – Visakhapatnam Steel Plant”.

The Steel Secretary, Shri P.K. Mishra, senior officials of the Steel Ministry, SAIL and RINL attended today’s meeting.