Representatives of the All India Induction Furnace Association (AIIFA) have come out strongly in support of the One Grid One Tariff policy for EAF/IF industry to check disparity in power tariff in different Indian states. AIIFA members and other industry participants voiced their concerns over the issue at the 31st National Seminar on “Strengthening Green Steel Production” on November 24, 2017 at New Delhi. Close to 300 industry participants gathered for the seminar to discuss the key hurdles being faced by the steel Industry today.
Key highlights of AIIFA’s 31st National Seminar
– To Reduce Power tariff and remove hurdle from the Open access facility through “One Grid One Tariff”
Power is an important raw material for the EAF/IF industry but the tariff has been on a continuous rise year after year. Also, there has been a rising disparity among power tariffs between different states. Getting power through open access of supply has been hampered by discoms of various states by imposing cross subsidy and surcharges along with wheeling and transmission charges so as to make open access of power unviable. As a result industries are forced to use costlier power from state utilities. The most viable solution to this problem would be the One Grid One Tariff policy
– Abolition of basic custom duty (2.5%) on import of steel melting scrap
India produced nearly 52 MnT of steel through Electrical route, out of which about 28 MnT is produced by way of steel melting scrap. To produce 28 MnT around 30.8 MnT of scrap is needed. India imports approximately 7 MnT of scrap. India presently does not have a defined policy for end of life automobiles. Moreover, availability of domestic scrap is scarce due to low per capita steel consumption. Therefore, to mitigate this gap import of scrap is necessary, delegates at the event highlighted. In such a situation the imposition of 2.5% import duties on such low valued items make’s imports unviable for scrap importers.
– Consistent availability of domestic scrap
India has over 18 crore vehicles. The old and ramshackle automobiles are a major cause of environmental degradation. Experts believe If 2.8 crore of such vehicles are destroyed, the annual requirement of 30.8 MT of scrap can be fulfilled comfortably. A levy of ‘end of life’ vehicle will not only ensure the availability of scrap in the country but would also pave the way for automotive industry to increase productivity by 22%.
– Mandatory quality control order for sponge iron
In India about 24 MnT steel is produced through sponge Iron as feed materials. For better yield, the metallic iron content should be at the highest possible range with Sulphur and Phosphorus as low as possible. However, the Quality control order till date has not been enforced on sponge iron units. AIIFA has urged Ministry of Steel to bring Sponge Iron under mandatory Quality Control Order so that BIS standard on steel quality can be maintained. AIIFA members have also demanded that till that time, the quality control order for steel may be kept on hold.
– Environmental Clearance for the Project above 30,000 TPA production of Billet/Ingot
To increase capacity beyond 30,000 TPA Environmental Clearance (EC) is required from CPCB (Notification no. S.O. 3067(E) dated 1st December, 2009 under item no.4, Note (ii) of Section “C”) which is not only time consuming but also one of the major barriers for modernization/ expansion of existing units as well as for commencement of new project. In today’s time a project less that 30,000 TPA production of Billet/Ingot is not viable because of Economy of Scale.
The minimum requirement of the project which is considered to be viable is 100,000 TPA and above and such unit may be either standalone units or integrated with continuous casting and Rolling Mill to produce final rolled product through the Direct Rolling Technology.
– Non acceptance of Steel products produced by Secondary Steel producers by the Government procurement agencies
None of the Government procurement agencies like RDSO, CPWD, NHAI, Ministry of Railways etc. have agreed to use materials produced by secondary steel producers and are still continuing with the old Classification. As the route of steel making i.e. whether large scale or medium/small scale ordinarily has no bearing on the quality of steel.
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