We face significant challenges to keep up with the pace of technological changes and to ensure that our manufacturing facilities are modern to be efficient with minimal impact on environment. Technological solutions for the steel industry are increasingly being developed with focus on reducing carbon footprint, using inferior raw materials, yield improvement, solid waste utilisation and moving towards a regime of zero water discharge.
In India, the use of inferior quality of indigenous raw materials and the variability in ore, compared to imported raw materials, pose an enormous challenge in terms of achieving high quality products, generation of wastes and energy utilisation. Also domestic needs of global manufacturers for high quality products as well as the continuously evolving demand for newer, high strength grades of steel, makes it necessary for steel makers to expand the capability of their finishing mills to include high-end, high strength products.
In India, we operate primarily in the traditionally backward states of Jharkhand and Odisha, with higher than national average illiteracy and Scheduled Caste (SC) and Scheduled Tribe (ST) community population. These states are also impacted by extremist activities in their rural areas. Most people in these states depend upon rain-fed, single crop agriculture for livelihood. Rapid socio-economic development in these states is a challenge.
With our operations largely confined to areas with a sizeable SC and ST population, we believe that promoting Affirmative Action based on positive discrimination is the right thing to do, besides fostering desirable diversity at the workplace.
Steel manufacturing is hazardous by nature. The commitment of global steel manufacturers towards building a sustainable world is manifested in the goal of achieving an injury-free, illness-free and healthy workplace. This is the primary focus in all our operations.
Despite the rise in labour productivity in India, sustainable growth requires investments in intellectual capital and structural reforms. The Indian Industry has proposed a review of labour laws in the country to help boost industrial productivity. It has voluntarily committed to address the mismatch between the representations of socially and economically challenged communities in their workforce as a proportion of their representation in the total population through Affirmative Action. This includes employment and employability initiatives.
In view of the outcome of climate negotiations at COP21 and India’s commitment to address Climate Change through its Intended Nationally Determined Contribution (INDC), a reduction in emission intensity of its GDP by 33 to 35% by 2030 compared to 2005 levels is expected. For this, Indian Steel industry will have to aggressively cut down CO2 emissions. While the Government has not set any sector specific targets, the Ministry of Steel has prepared a road map. The emission target set for steel production via the BF/ BOF route for 2020 is 2.4-2.6/tcs and the target for 2030 is 2.2-2.4 /tcs. The doubling of the Clean Energy Cess from ₹200 to ₹400 per tonne would raise input costs for domestic producers.
In recent years, the Government of India and NGOs have shown concern over the continuous degradation of biodiversity and erosion of ecosystem service. As a party to the Convention on Biological Diversity (CBD), India has developed 12 National Biodiversity Targets (NBD) using the Strategic Plan 2011-2020 and its 'Aichi' (named after venue for convention on biodiversity) targets as a framework. National Biodiversity Targets relevant to the steel industry include NBD 1, requiring a significant proportion of India’s population, especially the youth, to be aware of the values of biodiversity and the steps they can take to conserve and use it sustainably and NBD 9 on national initiatives to protect, use and strengthen the traditional knowledge of communities relating to biodiversity.
India jumped 12 places up in the “Ease of Doing Business” ranking of the World Bank in 2016, to which the Economic Survey 2016 attributes a dramatic spurt in Foreign Direct Investment flows by 40% during the year.
With the Union Government having a clear majority and thereby ensuring political stability, corporates have eagerly anticipated quicker reforms, such as the Goods and Services Tax (GST) and implementation of the Insolvency and Bankruptcy Code. However, there are significant grey areas in the law, particularly insufficient clarity on taxation rates and its likely applicability to the steel sector. Additionally, the delay in the Land Acquisition, Rehabilitation & Resettlement (LARR) Act and reforms in labour legislations are also likely to throw up challenges on the economy and the steel sector.