Page 19 - August-2020-Issue

ARTICLE

Challenges & Opportunities

for Steel Industry under

COVID-19 Pandemic

Sushim Banerjee
DG, INSDAG

Prologue industrial and service sectors Industry Impact
Writing on the growth and pros- would be captured adequately in Table-1 takes a look at the indus-
pects of any commodity specifi- the national Accounts data for Q1 try indicators in March’20 and in
cally that of steel under the cur- and Q2 in FY21. FY20 to highlight the impact of
rent unprecedented crisis that has COVID-19 on steel consumption.
engulfed nearly all the regions of
the globe and all sectors of the Table-1: IIP movement in March’ 20 and FY 20 (% rate of growth)
economy, becomes most chal-
lenging, more so as steel gets Parameters Growth in Growth Remarks
its sinews from the growth of March’ 20 in FY20
major economic and industrial Mining - 1.7 Mining sector reforms would lead
indicators of the economy. Till to more growth
February’20 it was observed that Manufacturing (-) 20.6 (-) 1.3 Weak link. Make in India to be
during FY20 the behaviour of given special thrust
Indian economy was progressing Mfg. of base (-) 18.6 10.8 Good indication for steel
at a rate below the average trend Metals production
rate that the economy had posi- Mfg. of (-) 31.7 (-) 12.2 Weak demand for capital goods
tioned itself in the earlier 5 years, Machinery and – more investment in infra to
the emergence of the pandemic Equipment recover demand
and the resultant lockdown since Mfg. of electrical (-) 31.0 (-) 4.2 Electrical equipment sector
the second fortnight of March’20 equipment growing with rise in electricity
had indeed provided a high generation
downsize risk on all the param- Mfg. of vehicles, (-) 49.6 (-) 18.5 Auto sector to reverse downward
eters of the economy. trailers risks in Fy21
Thus the latest release on GDP Mfg. of furniture (-) 22.8 (-) 6.8 Per capita income growth to drive
demand
growth in FY20 (4.2 per cent
against 6.1 per cent in FY20) by Electricity (-) 6.8 1.1
CSO did generate a pleasant sur- Total Industry (-) 16.7 (-) 0.7
prise as the economy showed re- Capital Goods (-) 35.6 (-) 13.7 Replacement of import of
silience in achieving this level of engineering goods to lead to
growth under the current scenar- growth in capital goods
io. It is possible that the estimates Infra/ (-) 18.5 8.8 Infra investment (both public and
may be revised when the full data Construction private) to grow
is made available later. Further, Consumer (-) 33.1 (-) 8.4 Per capita income growth likely in
it is believed that full impact of Durables H2 Fy21
the pandemic hampering both Source: CSO

KaleidOscope August, 2020 19