Cheaper imports, low demand and high electricity tariffs have forced steel mills in many states to shut. The ones operating are being run at suboptimal levels and are on the verge of closure even as the government seeks to take its ambitious Make in India programme forward. Owners of auxiliary steel industrial units in Punjab, Maharashtra, West Bengal and Madhya Pradesh said easier access to lowcost electricity from spot markets could have helped them stay open.
The situation is also grave for other energy intensive industries such as textile and cement plants in many states.
Prices in the spot markets have fallen to less than a rupee per unit in nonpeak hours, while the average price is Rs 2.2 per unit.
More than half the induction furnaces in Mandi Gobindgarh, the hub of secondary steel production in India, and the Ludhiana areas of Punjab have closed in the past few months.
The industry has touched its lowest point due to the slowdown in economic activities, said Sandeep Jain, president of the All India Induction Furnace Association.
Source: Economic Times