Reiterating its request for setting up an entity on the lines of Power Finance Corporation (PFC) for funding steel projects, State-owned Steel Authority of India ltd (SAIl) Chairman CS Verma on Wednesday said that this kind of a body would help in the long run as India requires around $200 billion to treble its steel-making capacity to 300 million tonnes per annum (mtpa).
He urged the Steel Ministry to facilitate setting up of manufacturing units for equipments required in a steel plant and reduce dependence on imports of such items, which may cost $120 billion, for adding 200 mtpa capacity.
India at present has about 90 mtpa steel production capacity. A high-level committee, headed by Prime Minister Manmohan Singh, had recently drawn a roadmap for taking the capacity to 300 mtpa by 2025-26.
“The 200 million tonnes increase in steel capacity on incremental basis would require huge capital investments, almost about 200 billion dollars at about $1 billion per million tonne capacity,” SAIl Chairman Verma, who was addressing a steel summit organised by industry body CII, said.
This massive requirement would entail coming together of banks and financial institutions to pool in their resources and come up with a dedicated body to finance these projects on the similar lines of Power Finance Corporation (PFC), he said speaking at an event here.
“PFC is committed to the integrated development of power and its associated sectors. Therefore, a dedicated financial institution, on the lines of PFC in the power sector, should be floated by the Ministry of Steel,” Verma said.
Meanwhile Steel Minister Beni Prasad Verma while inaugurating the conference earlier in the day, asked domestic steel makers to adopt technologies for producing high-grade steels and avoiding costly imports.
“Though India is able to meet most of its steel demand through domestic production, some special grades are imported. Steel producers need to adopt suitable technologies to produce such special grade steel at competitive price to avoid costly imports,” the Steel Minister said.