NEW DELHI: Investments in the Indian steel sector have not been "very forthcoming" on account of factors such as excess capacity in China which stood in the range of 250-300 million tonnes (MT), Parliament was informed today.
"Investment in steel sector has not been very forthcoming especially from the private sector due to the prospects not being very encouraging," Minister of State for Steel Vishnu Deo Sai said in a written reply to the Rajya Sabha.
The Minister added this has been impacted due to factors like "...the present global excess capacity, particularly in China, which has a huge excess capacity of 250-300 MT leading to significant decline in steel prices and increased imports and resultant financial stress on the existing domestic steel companies."
To a separate query in the House on steel prices, Sai said the prices of steel items in the domestic market have decreased in the recent period due to various reasons like slow growth in domestic demand and cheap imports.
To another question on import of steel products, the Minister said: "There is no proposal to specifically restrict steel imports from Northern and Eastern countries."
Steel imports have significantly increased in 2014-15 and in the current fiscal, Sai added.
"This is on account of market dynamics relating to a global steel glut, slowdown of steel demand in important steel producing countries like China, which has led to slashing of international steel prices making attractive for imports into India," the Minister explained.