Steep hike in steel prices worries industrialists
Shivani Bhakoo
Tribune News Service
Ludhiana, February 22
The prices of steel have increased to Rs 4,000 per tonne in last 15 days. This steep hike has resulted in “cartelisation” of the product due to which the local industry feels the pinch. Not just the related industry is worried about the increased prices, even consumers will have to face the brunt at a later stage.
President of the United Cycle Parts and Manufacturers’ Association (UCPMA) Charanjit Singh Vishvkarma said in China, the price of steel was between Rs 23,000-Rs 25,000 per tonne whereas with levying of Minimum Import Price (MIP) on steel by the Central Government, on February 5, the prices of steel have increased to Rs 35,000 per tonne in India.
“Ever since the prices have increased, major players of steel in the country have got hold of the product and a kind of scarcity is being created. The metal is being sold at hefty prices by those having a monopolistic approach and with that the MSME sector is worst affected. Now, traders will start importing finished goods at cheaper prices and local manufacturers will suffer. Persons like us who have to make the product by purchasing raw material are bound to suffer because of steep prices of steel,” Vishvkarma added.
President of the Chamber of Industrial and Commercial Undertakings (CICU) Avtar Singh said steep hike in prices of steel was proving to be a disaster for the MSME sector. He said the increased rate of steel was having a serious impact on engineering exports which had already witnessed a decline by 15 per cent in the first nine months of the current fiscal.
Meanwhile, Badish K Jindal, chairman, Federation of Association of Small Industries of India (FASII), said the cost of raw material had increased up to 8-10 per cent and segments like auto and parts, cycle and cycle parts, industrial or electrical machinery, which were presently running at low margins, were being forced to purchase raw material at escalated rates for survival.
The business community said the government may have taken the step to curb excessive import of material from China, but the reality was that China would continue to supply steel and products at much cheaper rates and it would be the local industry which will suffer.
