Prime Minister of India - Dr. Manmohan Singh

PM’s speech at presentation ceremony of Prime Minister’s Trophy to the best performing steel plant

"I am very happy to be present once again in today’s function to felicitate the best performing integrated steel plants during the years 2008-09 and 2009-10. I warmly congratulate the management and the entire workforce of Tata Steel Limited, Jamshedpur and Bhilai Steel Plant of Steel Authority of India Limited for their outstanding performance in 2008-09 and 2009-10 respectively.

The per capita consumption of steel is an important indicator of the economic development of a country. In 2004-05, our per capita consumption of steel was only 34 kilogram, which has grown to 59 kilogram in 2011-12. India has now emerged as the 4th largest steel producer in the world with a production of about 74 million tonne in 2011-12. With increased emphasis on achieving international benchmarks, the Indian steel industry has also been gradually becoming a modern and efficient industry. But we can’t be satisfied with status quo. We must strive for better and better results in years to come.

Despite such impressive progress, our per capita steel production still lags substantially behind the global average of 215 kilogram. There are also important quality related issues in respect of several critical steel products produced and sold in our country.

I am very happy that the public sector steel plants under SAIL and RINL have taken up massive modernization and expansion plans which will not only increase their production capacity but also improve their efficiency on productivity. Simultaneously, the private sector steel plants have also, on the average, grown bigger in size. A number of them have achieved an annual capacity of 10 million tonne and several smaller steel plants are also in the process of expanding their capacities. With these capacity additions, we hope to soon become the 2nd largest steel producer in the world.

In the last six years our consumption of steel has grown by about 8 to 9 percent each year. As growth in steel production lagged behind the growth in consumption, the country turned from being a marginal exporter of steel to a net importer of steel. I am told that our imports are large mainly on account of certain very special grades and types of steel that are not produced in the country. The steel industry needs to find out practical ways to develop or procure technologies to produce such special grades of steel and thereby minimize our dependence on imports.

Limited availability of high grade iron ore and good quality coking coal is yet another challenge that the Indian steel industry needs to overcome. We need to address this issue through management of technological change and through innovation. It is important that we encourage the use of low grade iron ore fines to sustain the long-term growth of the steel industry. Furthermore, new technologies for production of steel directly utilizing iron ore fines and non-coking coal need to be developed and adopted to minimize our dependence on imported and costly coking coal and lumpy iron ore. I am happy that the Ministry of Steel is implementing a new research and development programme in the sector to address perennial technical problems associated with the use of Indian iron ore and coal besides developing suitable technology for producing quality steel. The steel industry should add to this effort by investing more in Research and Development.

The iron and steel industry is heavily dependent on natural resources as well as energy. It is also characterized by high environmental pollution and high emission of Green House Gases. Therefore, we must collectively find effective ways and means to improve energy efficiency and limit environmental pollution in the steel industry even as we increase our steel production. I would urge the steel industry to ensure that we adopt the latest energy efficient technologies in our modernization and expansion programmes. Our Government has launched the Perform, Achieve and Trade (PAT) Scheme under the National Mission for Enhanced Energy Efficiency. I am sure that the steel industry will work with the government to achieve the targets set under this scheme.

Let me end by once again congratulating Tata Steel and Bhilai Steel Plant who have won trophies today. I wish the steel industry and all those associated with it the very best in the years to come."