New Delhi | Jun 01, 2015:

India will ramp up its steel capacity to 300 million tonnes (mt) from 88mt by 2025, according to a blueprint for expansion drawn up by the steel ministry.

In an interview with The Telegraph, steel minister Narendra Singh Tomar said, "SAIL alone will double its capacity to 50mt during this period, while another 24mt will be added by four new plants to be set up as special purpose vehicles (SPVs)."

SAIL's current expansion programme to raise its capacity to 23mt will be over in another four months with the upgrade of its Bhilai facility. The state-run company is being asked to go in for another wave of expansion to take its capacity to 50mt in 10 years.

Besides the four SPVs, in which state governments and PSUs will invest, are expected to set up plants in Chhattisgarh, Jharkhand, Odisha and Karnataka.

These plants are expected to have an initial capacity of 3mt each, to be doubled to 6mt in the next phase.

The blueprint also envisages foreign steel makers to set up base in the country, especially to make higher grade steel.

"We encouraged SAIL to join hands with Arcelor Mittal to set up an automotive steel venture. We want foreign players to come in and make similar high-grade steel in India," the minister said.

However, it has been difficult to get the foreigners part with their technology.

Attempts to persuade multinationals to transfer technology for cold rolled non-grain oriented steel (used to make electrical equipment) have been unsuccessful.

"We realise that one of our weaknesses has been in the area of steel research. We are setting up a Rs 200-crore Steel Research & Technology Mission with Rs 100 crore from the Steel Development Fund and another Rs 100 crore to be given by steel majors such as SAIL. The mission will focus on new grades of steel for specialised use," said Tomar.

Small units

At the same time, the ministry has lined up meetings with mini steel mills and forges in the next two months to firm up an expansion strategy. These entities generate half of the current production and are also a major employers.

This will include modalities to allow them to source high-grade iron ore for value-added production.

"The next two months we will work with them," said the minister. Officials said at least a third of the 300mt capacity would be accounted for by the small players.

The government will also implement a new act which calls for the auction of iron ore mines, grant of leases for 50 years and a faster renewal and grant of licences.

Besides, "we realise that the best way to get a good price for mining acres is to have proper geological surveys done for the mines we will put up for auction", said Tomar.

(Source: http://www.telegraphindia.com/)