Date:07/07/2004 URL: http://www.thehindubusinessline.com/2004/07/07/stories/2004070701090500.htm

Back Steel industry sees fillip to demand

Our Bureau

New Delhi , July 6

THE steel industry today welcomed the Railway Budget for 2004-05 and had a sigh of relief that freight rates have not been increased further. The industry was also upbeat about the Railway Minister, Mr Laloo Prasad Yadav's proposal for introduction of new trains and increased use of stainless steel wagons.

The Indian Steel Alliance welcomed the Railway Budget by saying that it will increase steel demand.

"The initiatives outlined in the Budget regarding introducing new trains, adding more routes, up-gradation of several routes from narrow gauge to broad gauge and doubling of tracks on several routes will certainly give fillip to the steel demand in the country," said the ISA President, Mr Moosa Raza.

"While steel industry is happy that status quo has been maintained on freight rates, it was hoping that the inflated mileage on the KK line would be withdrawn and some rebate would have been provided for all rail consignments from plant to port destinations. There are still hopes to rationalise the current freight rates, as they are still higher than those in developed nations in terms of PPP," he said.

According to the President of the Indian Stainless Steel Development Association, Mr N.C. Mathur, "The Minister, in the Railway Budget, very clearly specified the usage of stainless steel in freight wagons for handling and transport of minerals like iron ore and coal from their mines to their destinations. Stainless steel wagons are already in extensive use in South Africa and Australia due to life cycle cost advantage and minimum maintenance."

The stainless steel industry in India is fully geared to meet this demand and they have been interacting with the Lucknow-based Research, Design and Standards Organisation of the Indian Railways and the Railway Ministry on the same, he said.