India is the only country among the world’s top steel producing nations to post a growth in steel production during April this year, according to figures compiled by the World Steel Association.
India, the second-largest steel producer in the world next to China produced 12.1 million tonnes of steel which represented a 3.6 per cent increase over the same month of the previous year.
According to economists, the growth in India’s steel production reflects the higher level of economic activity taking place in the economy.
Large infrastructure projects in the road, rail and ports sectors that are being implemented by the government to push growth and create employment in the country use large quantities of steel as an input.
Similarly, the demand for products such as cars, two-wheelers and commercial vehicles that have been growing in the economy also leads to an increased demand for steel as a raw material.
India has emerged as a bright spot amid the global slowdown and the steel sector is a reflection of this. The World Steel Association data show that Japan produced 7.1 million tonnes (MT) of steel, down 2.5 per cent.
The US produced 6.7 MT, down 2.8 per cent.
Russia is estimated to have produced 6.2 MT, down 5.7 per cent and South Korea produced 5.1 MT, down 10.4 per cent.
China, which has massive excess capacity in steel and has run into the US tariff barrier for its exports, recorded a 7 per cent decline in production to 85.9 million tonnes.
There is serious concern worldwide that China may now resort to dumping its excess steel at cheap prices in other countries as it has lost the US market.