"This imbalance may not be allowed to continue," he said on the sidelines of a seminar. "The Indian government has taken policy measures to discourage avoidable exports and raise domestic availability by increasing export duty on lump ores to 15 percent."
His statement followed remarks made by L.N. Mittal, CEO of ArcelorMittal, who said that despite the expanding steel making capacity in India, the country is set to face a massive shortfall in supply in the coming decades.
Mittal estimated that the supply shortfall may hit 33 million tons by 2020, which would be equivalent to two third of India's current output. He expected the supply base to increase to 131 million tons by 2019.
Demand for steel would expand from a current level of 56 million tons to 150 million tons in 2019 and to 164 million tons by 2020, added Mittal.
In a separate development, Steel Authority of India Ltd (SAIL)'s proposed joint venture with Korean steelmaker Posco would be frozen by November this year as it was planning another JV with Kobe steel of Japan, according to an official.
"The MoU with Posco for setting up a steel plant at Bokaro in Jharkhand using Finex technology was signed in May this year. A detailed project report (DPR) is being prepared. The DPR will be ready by November and by then we will be able to freeze the JV with the Korean steelmaker," said CS Verma, Chairman of Steel Authority of India Limited (SAIL).
"The entire project, whose gestation period would be three years, is on fast track," said Singh. "Initially the size of the plant would be 1.5 million tons, which would be ramped up to three million tons. This would require an investment of $2.6 billion-$3.25 billion."
The Indian steel minister said Posco, which would provide the Finex technology, might insist on having majority stake in the proposed project.
"Our effort will be to make it a 50:50 JV. However, we cannot be rigid since we need the technology. This will be the first plant outside South Korea, which will use Posco's Finex technology," said Singh.
Separately, a leading steel wire manufacturer in western India on Saturday said it plans to tap the capital market through an initial public offer of $20 million in a bid to meet the rising demand for steel products.
Bedmutha Industries said it will utilise the IPO proceeds to set up a 36,000 tonnes per annum (tpa) manufacturing facility for low relaxation pre-stress concrete wire and spring steel wire with installed capacity of 18,000 tpa on 12 acres at Nashik in Maharashtra.
