Hyderabad: The road to the recovery of the Telangana steel sector is expected to be long, winding.
With a dry infrastructure project and there is no concession of fixed costs such as high-power tariffs, labor costs and interest in loans, this sector is felt that the resurrection of demand for the near future and government support can help it return to the foot.
Vinod Agarwal, Implementing Director, Profile of Mahalakshmi Pvt Ltd, shows that there is no availability of oxygen since mid-April and only a few units that hold liquid oxygen stock can operate.
In steel mills, oxygen is used in the furnace and in cutting metal.
“While the supply of oxygen to the steel unit continued since the first week of June, the request was subdued due to the lack of government expenditure on infrastructure,” he said.
Vinod Kumar Agarwal, Director, Sallari Iron & Steels Pvt Ltd, felt it would take at least one year for the sector in Telangana to recover from a locking blow.
Pointing at high labor costs, said the majority of workers were migrants from Bihar, Uttar Pradesh, Odisha and Jharkhand, among others.
“Without clarity how long the Kuncian will take place, it is impossible for us to let the workforce go because it will cause a massive challenge when reopening the unit.
Therefore, we continue to pay their salaries,” he added.
Anil Agarwal, Promoter, Jeevaka Industries Pvt Ltd, shows that commodity prices are at the highest point of all time, it has an impact on raw material prices such as iron ore and coal.
To worsen the situation, the steel unit also wrestles with high power rates.
“While power outages have become something from the past, high power rates have made us uncompetitive,” he is Ruja.
Steel is an industrial and intensive plants force must pay minimum demand power rates even when their plants are not operating.
This problem is currently sub-yudice.
“Telangana must see reducing rates from more than Rs 6.50 per unit to carry it on par with Chhattisgarh (around Rs 5.50 per unit) and Maharashtra (around Rs 4.50 per unit),” Agarwal said from Mahalakshmi’s profile, added that This will not only increase growth and work, the state government will be able to restore power tariff concessions in a higher way GST income.