Short essay on Iron and Steel Industry of India



Iron and steel industry is a basic industry which provides sound base for modern industrial development.

It provides raw materials for machine tools, construction, transport, agricultural imple­ments and several other industries which are so essential for modern civilization and way of life.

So much so that the quantity of steel production and its per capita consumption are used as measures to judge the level of industrialisation and economic development. Although India is the eighth largest steel producing country of the world but its per capita consumption of steel (24 kg in 1998-99) is much below than the world average (150 kg) and developed countries (U.S.A. 700 kg).

Historical Development

The art of steel making has been known to India since early times as is proved by the famous iron pillar of Delhi dating back to 350 A.D. Similarly the woods steel, manufactured in Hyderabad, was exported to Persia so as to be used in the manufacture of famous Damascus blades during the medieval times.

The first attempt to produce iron and steel, on modern lines, was made in 1830 at Porto Novo (Tamil Nadu). The mill was closed down in 1866. Similar attempts were made at Bayport (Kerala), Coimbatore (Tamil Nadu), Birbhum (West Bengal) and Kaladhungi (Uttar Pradesh) during 1830-60; all of which were unsuccessful. For the first time the pig iron was produced successfully in 1874 by the Ben­gal Iron Works, a predecessor of the Bengal Iron Company incorporated into IISCO subsequently.

A turning point in the history of iron and steel production in India came in 1907 when the Tata Iron and Steel Company were set up at Sakchi (now Jamshedpur) by Sri J.N. Tata. The factory started its first production of pig iron in 1908 and steel in 1911. The First World War gave a big boost up to the
industry. Consequently, the Indian Iron and Steel Company Ltd. (IISCO) was set up at Hirapurin 1918 and the Visveswaraya Iron and Steel Ltd. (VISL) at Bhadravati in 1923. Protection by the government and the Second World War gave further impetus to the industry. In 1949 the three steel plants (TISCO, IISCO and VISL) with total installed capacity of 1.2 million tons produced 9.76 lakh tonnes of steel.

After Independence rapid stride in iron and steel industry was made during 1956-61 with the establishment of three new integrated steel plants under Hindustan Steel Ltd. at Rourkela, Bhilai and Durgapur, with a total capacity of 10 lakh tonnes each.

The capacity of TISCO and IISCO was also increased to 20 lakh tonnes and 10 takh tonnes respectively. In the Third Five Year Plan efforts were made to expand the capacity of three existing public sector plants and set up a new steel plant at Bokaro (in 1964) which started production in 1972 (capacity 17 lakh tonnes).

The Steel Authority of India Ltd. (SAIL) was set up in January 1973 to ensure co-ordinate development of the industry in the public and private sectors. In the Fifth Five Year Plan decision was taken to set up four new steel plants at Salem (Tamil Nadu), Vijaynagar (Karnataka), Vishakhapatnam (Andhra Pradesh) and Paradwip (Orissa). The expansion projects for Rourkela and Durgapur steel plants have been completed in 1996- 97.

The new industrial policy announced in July 1991 has removed 'iron and steel' from the list of industries reserved for the public sector, and has also exempted it from the requirements of compulsory licensing. Entrepreneurs are; therefore, free to set up steel plants of any capacity, subject to certain location restrictions.