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Indian steel ministry sets up a panel with BCG to turn around SAIL & RINL-The 18th China(Guangzhou)I
nt’l Metal &Metallurgy Exhibition
4/1/2017 steel expo-metal &metallurgy expo |
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Reuters reported that the Indian government has set up an expert panel to help revive its loss-making state steel maker after a government review found the company to be far less efficient than its rivals despite spending more than $10 billion in the past eight years. The panel, comprising top officials of various government ministries and SAIL, met for the first time this week and will be helped by Boston Consulting Group in coming up with a revival plan for the company.
They will set quarterly, six-monthly and yearly targets for SAIL, according to the memo. Two government sources said minister Singh wants a plan for SAIL and smaller state steel company RINL in 15 days.
Steel Minister Chaudhary Birender Singh, worried by what he called SAIL''s unsatisfactory output performance, has asked the panel to recommend a timeline for ramping up capacity at a quick pace, to find ways to lower production costs and to improve branding and marketing. Mr Singh''s office told the committee this week that "The terms of the reference of the committee will include chalking out a revival plan for turning around loss-making (companies) of the Ministry of Steel to profit-making companies in 2017/18.”
A review document, containing previously undisclosed data and seen by Reuters, criticises Steel Authority of India for everything from the use of low-quality raw materials to outdated technology, suggesting that its problems were not simply the result of cheap Chinese steel imports.
SAIL, which has been overtaken by JSW Steel as India''s biggest producer, has posted seven straight quarterly losses, and Reuters reported last week that it was at risk of losing business from its biggest client.
The Reuter report added that a SAIL spokesman did not respond to requests for comment. A steel ministry spokesman declined comment.
Th Reuter report added “SAIL fares poorly when compared to international efficiency standards and those of private Indian companies such as JSW and Tata Steel in blast furnace productivity, raw material consumption and energy usage, according to the review document. For example, SAIL''s average daily blast furnace productivity of 1.58 tonnes per cubic meter last fiscal year ended March was 40 percent lower than that of JSW. SAIL said the metric improved 7 percent between April and December last year.Its use of coke was also higher than private peers and global standards. April-December coke use came down 3 percent from a year ago. Its use of pulverized coal injection technology was the lowest compared to JSW and Tata in 2015/16.”
-The
18th China(Guangzhou)Int’l Metal &Metallurgy Exhibition
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