JOHANNESBURG - By 2016, India is planning to become the world’s number two steel producer with a production capacity of 120 million tons per year, a tripling of the current capacity which is at 44 million tons annually, according to R. S. Pandey, the Indian government’s steel secretary and researched by Industrial Info Resources.
According to Pandey, the original forecast of 65 million tons of production capacity by 2010-11 has been revised to 80 million tons, with a target of 180 million tons per year by 2019-20.
India is now the seventh in global steel production capacity, having moved from the ninth spot in 2004 to eighth in 2005. China is currently in the first spot with an annual capacity of 418 million tons, followed by Japan with 116 million tons and the U.S. with 98 million tons, notes Industrial Info.
India is now in the process of acquiring large steel companies that are bigger than the ones in their country, and according to Pandey the steel sector is increasing 50 percent faster than had been anticipated.
Following the acquisition of the Anglo-Dutch steelmaker Corus by India’s Tata Steel for $12 billion, India’s Essar Steel signed a $1.58 billion deal for Algoma Steel of Canada. Essar will be investing $1.6 billion in Minnesota Steel Industries to construct a fully integrated steel plant in northern Minnesota, Industrial Info said.
According to Pandey, by 2010 the Steel Authority of India (SAIL) and Rahtriya Ispat Nigam (RINL) will invest $11.36 billion into expanding operations to met domestic demand. SAIL, with a current production capacity of 13 million tons, expects to produce 23 million tons by 2010 and RINL will double its capacity to 8 million tons, Industrial Info’s research indicates.