Essay on the growth of Iron and Steel Industry in India

Ours is an industrial age. On account of many qualities of hardness, strength, durability, malleability and cheapness, iron is the most important and widely used metal.

Industrial growth, means of transport, cemented tall buildings, dams, tunnels, bridges, armaments etc. would not have been conceived and built without iron.

Iron and steel is basis for laying the vibrant Indian industry. Production of steel has come to exist as an index of a country’s potential, industrial and economic growth.

The making of iron and steel had been known to the people of India since long. The iron pillar of Delhi is a proof of it and speaks of the quality of steel produced in this country in ancient times.

The first attempt to start an iron and steel mill at Portonova in Tamil Nadu was made in 1830 by Joshia Heath with the help of East India Company. This attempt failed. Later, in 1870 a plant was set up at Kulti (near Kolkata). This plant was taken over by the Bengal Iron and Steel Company in 1889. Then first modern steel plant was set up in 1907.

The credit of steel manufacturing on large scale goes to Jamshed Ji Tata, who set up Tata Iron and Steel Company (TISCO) at Sakchi (Jamshedpur- Jharkhand). This plant produced iron in 1911 and steel in 1913. In 1919, Indian Iron and Steel Company established a steel plant, at Burnpur (Hira Pur-Kolkata).

In 1923, Visvesvaraya Iron and Steel Works Limited (Mysore) started functioning at Bhadravati (Karnataka). The protection granted by the government to the industry and the outbreak of World War II gave an impetus to the industry.

Till 1950, there were only three iron and steel manufacturing plants in India namely TISCO, IISCO and VISWL and produced only 10 lakh tonnes of steel and 15 lakh tonnes of pig iron.

Iron and steel industry made rapid strides after independence. Special emphasis was laid on the development of the industry during the Second Five Year Plan. Three new integrated steel plants under Hindustan Steel Limited were set up at Rourkela (Orissa), Bhilai (Madhya Pradesh) and Durgapur (West Bengal).

The capacity of each plant was 10 lakh tonnes. These three plants came into operation between 1956 and 1962. The expansion of programme of TISCO and IISCO was also taken in hand to increase the capacity to 20 lakh tonnes and 10 lakh tonnes respectively. The expansion was completed in 1959. In the Third Five Year Plan emphasis was given on the expansion of three plants under H.S.L. and a new plant at Bokaro (Jharkhand) was set up.

Fourth Five year Plan further emphasized on having maximum production from existing plants and starting new plants at Salem (Tamil Nadu), Vijaynagar (Karnataka) and Vishakhapatnam (Andhra Pradesh) in order to meet the increasing demand of steel in the country.

In 1978, the installed ingot steel capacity increased to 106 lakh tonnes. The Salem Steel Plant started commercial production in 1982.

The management of IISCO was taken over by the Government of India in 1972 and ownership was acquired in 1976. In order to manage the affairs of execution of steel plants relating to iron and steel development, the Government of India set up an organization named Steel Authority of India Limited (SAIL) in January 1973.

Steel Authority of India (SAIL).

It was established in 1973. SAIL is a government undertaking and is responsible for the management of steel plants at Bhilai, Durgapur, Rourkela, Bokaro and Burnpur and also the Alloy Steel Plant at Durgapur and Salem.

The management of the Indian Iron and Steel was taken over by the Government on 14th July, 1976. SAIL also took over Maharashtra Elektrosmelt Limited, a mini steel plant, in January 1986. Visweswaraya Iron and Steel Limited were also taken over by SAIL in August 1989.

(a) Tata Iron and Steel Company (TISCO) (Jharkhand State). This plant is located at Sakchi, now known as Jamshedpur. The plant was set up by Shri Jamshedji Tata in 1907.

It is situated in a valley formed by the river Subarnarekha and the Khorkai in the Singhbhum district of Jharkhand State. The plant enjoys the following localisational advantages:

1. Coal comes from Jharia, situated at a distance of about 150 km.

2. Iron-ore is brought from Gurumehsani, Okampad, Badampahar and Noamandi deposits. All these centres are within a distance of 100 km from Jamshedpur.

3. The rivers Subarnarekha and Khorkai provide water.

4. Dolomite is obtained from Pagposh (Gangpur); Limestone from Birmitrapur and fire clay from Belapahar.

5. The works are in an infertile and thinly populated region as such labour comes from other parts of Bihar, M.P, Orissa and U.P

6. Jamshedpur is served by South-Eastern railway.

7. Kolkata, situated at a distance of about 250 km provides main market. It also serves as a port for the export of finished products.

All these factors have attributed to the development of TISCO the installed capacity of the plant is 2 million tonnes of steel ingots per annum. In addition to steel, various types of items like bars, rails, billets, tin plates, tin sheets, railway wheels, steel wires etc. are manufactured.

TISCO also runs another steel plant set up in Orissa at Gopalpur, 170 km SE of Bhubaneswar.

The favourable factors here are:

(i) Coastal location

(ii) Nearness to iron are

(iii) Cheap land

(iv) Fresh water from streams.

It is an integrated steel plant of latest technology having a capacity of production of 10-12 million tonnes.

(b) Indian Iron and Steel Company (IISCO) (W. Bengal).

The plants of this company are the oldest in India. The plants are located at Kulti, Burnpur and Hirapur in West Bengal (about 225 kilometres from Kolkata).

The management of this company was taken over by the government in 1972. The following factors have worked for the development of these three plants:

1. The plants are located near coal fields of Raniganj and Jharia.

2. Iron ore is obtained from Singhbhum and Mayurbhanj districts which are not far away.

3. Limestone is obtained from nearby quarries of Paraghat, Baradhar and Bisia.

4. Kolkata industrial region serves as the main market. Kolkata serves as a port.

5. Power is available from Damodar Valley Corporation Project.

6. Water is obtained from the Damodar River.

7. These plants are located very near (6-10 kilometres) to railway junction of Asansol.

Modernization of development of Burnpur plants was done in 1981 with the help of erstwhile U.S.S.R.

(c) Visvesvaraya (Mysore) Iron and Steel Works, Bhadravati (Karnataka).

This plant was established in 1923 with the help of an American Company under the name of Mysore Iron and Steel Works Limited. It is now a state owned plant. It was taken over by the state government in 1962. The following factors are responsible for its growth:

1. Iron ore comes from Kemmagundi ore fields of Bababudan hills, 40 kilometres South of Bhadravati.

2. Limestone is obtained from Bhundigunda deposits lying at a distance of only 20 kilometres.

3. The rich forest wealth of Shimoga and Kadur districts supplied charcoal to the plant. Now the plant is served by hydro-electricity from Jog falls.

4. Water is available from the Bhadra River.

5. Bhadravati is served by Southern Railway.

6. Shimoga and Chitradurga supply manganese.

7. Bhadravati is a wide valley thus enough land is available.

After independence, Hindustan Steel Limited was established. In 1973, the integrated steel plants opened by H.S.L. were taken over by Steel Authority of India Limited (SAIL).

(d) Bhilai Steel Plant (Chhattisgarh).

The plant was set up in 1957 with Russian collaboration at Bhilai. It is situated at a distance of about 720 kms west of the South- Eastern railway.

The development of this plant is attributed to the following factors:

1. Bhilai was a silent village in the Durg district of Chhattisgarh state. The availability of extensive flat land facilitated the setting up of the plant.

2. Iron-ore comes from Dhali, Rajhara mines situated at a distance of about 45 km from the plant.

3. Coal is brought from Bokaro of Jharkhand state and Korba of Chhattisgarh state.

4. Limestone is obtained from the Nandini quarries.

5. Tandula and Maroda tanks provide water to the steel paint.

6. The Korba thermal plant supplies electricity.

7. Labour is locally available. Tribals serve as labour at low wages.

The plant produced steel to its full capacity in 1961. The annual production is over 5 lakh tonnes of pig iron, 23 lakh tonnes of crude steel and 20 lakh tonnes of saleable steel.

This plant is known for its special items of sleeper bars, heavy structural, merchant bars and billets for re-rolling.

(e) Rourkela Steel Plant (Orissa).

It was set up in 1959 with West Germany’s collaboration. It is situated at a distance of about 400 kms from Kolkata on Kolkata- Mumbai main rail line.

It is the biggest steel rolling mill in Asia.

The Centre is at the confluence of rivers Sankya and the Koel which later merge to form the Brahmani River. The following geographical and economic factors have favoured the development of the plant:

1. The iron-ore of Bonai (Barsua and Gua Iron ore mines) is close by.

2. Coal is brought from Jharia, Bokaro and Kargali fields of Jharkhand State.

3. Limestone is obtained from Hathibari and Birmitrapur situated at a distance of about 25 km.

4. Water is supplied by the Mahanadi and the Sankya rivers.

5. Hirakud multi-purpose river valley project supplies water-power.

6. Rourkela is well-connected by rail and road with other centres of India.

7. Labour is locally available.

The annual production of this plant is 30,000 tonnes of pig iron, 11 lakh tonnes of crude steel and 10 lakh tonnes of saleable steel. Other important items manufactured here are slabs, plates, pipes etc.

(f) Durgapur Steel Plant (West Bengal).

This plant has been established with British collaboration. It was completed in 1960. It is situated on river Damodar and on Kolkata-Delhi railway line at a distance of 175 kilometres from Kolkata. The following factors have favoured the growth of this plant:

1. Iron ore is obtained from Gua mines of Jharkhand.

2. Coal is brought from Jharia and Barakar coal fields.

3. Limestone is brought from Rourkela and Bisra area of Orissa.

4. Water is provided by the Damodar River.

5. Hydel power is supplied by D.VC.

6. The plant enjoys excellent transport facilities.

7. Labour comes from adjoining areas.

Electrified railway system, a major highway and a navigable canal connect Durgapur place with the biggest consuming and industrial centre of Kolkata.

This plant is nearest to Kolkata as compared to other plants of Jharkhand, West Bengal and Chhattisgarh.

The annual production of this steel plant is 6 lakh tonnes of pig iron, 8-7 lakh tonnes of crude steel and 7 lakh tonnes of saleable steel. Durgapur Steel Plant specialises in the manufacture of light rails, beams, and fish plates, railway items of wheel, axils and sleepers. Its other products arc construction material.

(g) Bokaro Steel Plant (Jharkhand).

Bokaro Steel Plant was set up in 1965 with the help of erstwhile U.S.S.R. This plant was set up because the other plants could not meet the growing demand of the country. Its capacity was over 30% of the total installed capacity of integrated plants of India.

It is the largest steel plant in India. It is also called Swadeshi Steel Plant. Almost all the structural steel, electrical equipment, mechanical equipment etc. of this plant was manufactured in India.

The plant enjoys the following advantages:

1. Coal is available locally from Bokaro, Kargali and Jharia coal fields.

2. Iron ore is obtained from Berjmada belt in Southern Jharkhand.

3. Limestone is brought from Bhagwant Pur and Daltonganj quarries in Palamau district of Jharkhand.

4. Water is obtained from the Damodar River.

5. Cheap labour is available from the densely populated areas of Jharkhand, West Bengal, U.P and Bihar.

The annual production of this plant is over 50 lakh tonnes of pig iron, 20 lakh tonnes of crude steel and 17 lakh tonnes of saleable steel. Various items of production are rolled light plates, cold rolled coils, rolled sheets etc.

(h)Salem Steel Plant (Tamil Nadu).

This plant started commercial production in 1982. The plant uses imported iron ore for the manufacturing of high grade stainless steel. The imported slabs are rolled in Bokaro steel plant before these are used here.

This plant manufactures sheets of stainless steel of varying thickness. Stainless steel is exported to the U.S.A., Mexico, SE Asian countries and Australia. Metal coins are also made here to the tune of 3000 tonnes per year.

(h) Vishakhapatnam Steel Plant (Andhra Pradesh).

It is an important integrated steel plant set up in 1992. It has an ideal location at the port site. It is the only shore based plant. It is highly modern.

In 1999-2000 production was 2-9 million tonnes of hot metal, 2-6 million tonnes of liquid steel, 7-7 million tonnes of million pig iron and 2-4 million tonnes of saleable steel. It is a steel export oriented plant.

(i) Vijaynagar Steel Plant (Karnataka).

It has an installed capacity of 3 million tonnes.

(j) Another steel plant is being constructed at Paradwip.

Besides, these there are innumerable mini steel plants for meeting local demand of iron and steel. Most of such mini plants are located away from the integrated steel plants. There are nearly 200 mini steel plants in the country.

Mini Steel Plants.

In addition to the integrated steel plants a large number of mini steel plants have been set up in different parts of the country which depend on scrap/sponge iron as raw material.

They make mild steel. They meet local demand. Mini Plants had rapid establishment in the country. They manufacture nearly 32 lakhs tonnes of steel.

Sponge Iron and Steel Ltd.

This company based in A.P has set up Sponge Iron & Steel Plant at Kothagudem (A.P) in 1975. The production came out in 1980. The capacity of plant was later doubled by putting up another unit of 30,000 tonnes per annum capacity.

Metallurgical and Engineering Consultants (India) Ltd.

A design, engineering and consultancy organization has emerged a major consultancy service (MECON). During the last two decades MECON has been actively associated with the Indian defence sector in modernizing and revamping of existing units and installation like RDE (Research and Development Establishments).

Currently this organization is also assisting Indian space research organization Sriharikota for setting up a launch pad.

India ranks 10th largest steel producing country in the world. The per capita consumption of steel of 20 kg in India is much below the world average of 143 kg.

Per Capita Steel Consumption in CIS 420 kg

UK 422 kg

USA 734 kg

Japan 620 kg.

During 2000-2001 India exported steel to the extent of 2-67 million tonnes. It includes a long list of items like semis, hot rolled coils, cold rolled coils, colour coated sheets, GP/GC sheets, pig iron and sponge iron.

Problems of the Iron and Steel Industry.

1. The industry demands huge capital investment.

2. Manufacturing technology is old and of poor quality.

3. The per capita labour productivity of an Indian is far less in comparison to that of Japan and Korea. It is 90-100 tonnes a year of an Indian worker and 600-700 tonnes per year in respect of Japanese and Korean workers.

4. Potential utilization rarely exceeds 80%. Strikes, dharnas and lockouts, shortage of raw material, energy and inefficient management.

5. A part of steel demand is met by imports which are done at an exhorbitant rate.