If the last two years are any indication, India could be on the cusp of an exciting growth revolution and the forecast of an above-normal monsoon this year has buoyed hopes for demand revival in the economy. These positive trends on the economic front as the result of the government’s policy reforms and other measures have improved the investment climate in the country to sustain the emerging growth wave.
The infrastructure and construction sectors are the driving force for growth and the government’s priority on development in these segments has seen tremendous rise in usage of stainless steel as it is the new and one of the preferred materials because of its salient features.
In India, the application of this metal has predominantly been for kitchenware and utensils. However, with increased thrust on infrastructure and manufacturing, heavy investment is planned in airports, metros, seaports, highways, industrial estates and smart cities, etc. The railways is emerging as the biggest promoter of stainless steel with its massive modernization plans and the proposed high speed rail and freight corridors across India.
However, the current challenges faced by the industry on account of cheap imports at predatory prices are not going to vanish overnight as the prices of the metal have seen a new low due to the glut in the market with excess quantity of the metal coming mainly from China. It is quite difficult to implement a MIP type deterrent, as is imposed in the steel sector, in stainless steel products due to the volatility in prices of its raw material. The stainless steel industry needs a very strong anti-dumping investigation system in our country, quite similar to the USA or EU. A proactive approach by the industry associations and the DoC in this regard is essential to protect the domestic industry.
Due to higher capacity than demand, there is intense competition resulting in very competitive pricing scenario. There is also continuous product development which results in making certain products almost redundant. Stainless steel manufacturers therefore, must adopt strategies revolving around optimization of production costs using cheaper raw materials and innovative production processes.
India’s major stainless steel consumption is in the 200 series. There isn’t much threat of imports in this segment as it is extremely low priced and hence not very attractive for manufacturers in other countries. In flat products, there is a very serious threat of import from China. India is trying to overcome this with appropriate tariff barriers and other measures. Also, the RBI must intervene to arrest the rupee from falling further which will ward off threat from China and other manufacturers of stainless steel and other metals which find a ready market in India.
Taking a cue from the government’s ambitious projects lined up in the 12th Five-year Plan, this multi-purpose metal will have a critical role to help the country achieve its goal of all-round growth and the improving macro-economic scenario coupled with the government’s progressive measures will lend further impetus to business and industry giving the Brand India image a new dimension and recognition in the world community.