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Part - II

The per capita consumption of steel in India is only 27kg per capita, which is far below the level of other developed and developing countries - 472.4kg, 428.6kg and 128kg in USA, EU and China respectively. The average total factor productivity of the sector is only 25 percent of US levels with labour productivity at around 11% and capital productivity at around 39% of US levels. This is lower than developing countries such as Brazil and Korea and developed countries such as the US and Japan. In order for Indian industry to be competitive it has to reach 94 per cent of productivity.

In the last few years, the industry has been badly hit by overcapacity, cheap imports, economic slowdown, and low steel prices and anti dumping duty imposed by USA. In the year 2003-04 the cyclical natures of the industry was seen with steel prices firming up and demand for steel picking up especially from China. In the given below chart the prices for last year are shown: -

Domestic Price Trends for the past year of Hot Rolled, Cold Rolled
and Galvanized Products

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* Contributed by: -
Amit Chaddha,
B.E. (Metallurgy), MMS (Marketing),
School of Management Studies,
MNNIT Allahabad.