infrastructural challenges in steel industry -best paper published in 4th international steel...

8/3/2019 Infrastructural Challenges in Steel Industry -Best Paper published in 4th International Steel Logistics Conference in Antwerp

1/38

INFRASTRUCTURAL CHALLENGES FORTHE INDIAN STEEL INDUSTRY

Subrat Kumar Sahoo

Ispat Industries Limited

September 2010


2/38

INDEX

ABSTRACT

STRUCTURE OF THE INDIAN STEEL INDUSTY

DEMAND & SUPPLY

PRODUCTION

EXISTING CAPACITY AND FUTURE EXPANSION

COST COMPETITVNESS IN THE INDIAN STEEL INDUSTRY

LOSSES FOR THE INDIAN STEEL INDUSTRY

CURRENT PROJECTS

INVESTMENT

September 2010


3/38

INDEX

INFRASTRUCTURAL & LOGISTICS CHALLENGES IN INDIA FOR EXISTING,BROWNFIELD AND GREENFIELD STEEL PROJECTS IN INDIA

SWOT ANALYSIS STRENGTHS WEAKNESSES

OPPORTUNITIES

THREATS

CHALLENGES OF LOGISTICS IN THE INDIAN STEEL INDUSTRY

PERFORMANCE OF LOGISTICS

CHALLENGES OF OCEAN LOGISTICS MITIGATION PLAN FOR PORT LOGISTICS

CHALLENGES OF STEEL RAIL LOGISTICS MITIGATION PLAN FOR ROAD LOGISTICS

CHALLENGES OF OCEAN LOGISTICS MITIGATION PLAN OR ROAD LOGISTICS


4/38

ABSTRACT

Logistics and supply chain management is the most challengingresponsibility in the Indian Steel Industry. There has been tremendouspressure on the Industry vis-a-vis stringent competitive resources,performance, productivity, quality control and price reduction.

The Steel sector requires 4MT of bulk cargo to produce 1MT steel output.


5/38

Structure of the Indian Steel Industry

India has emerged the 3rd largest exporter of iron ore, after Brazil and Australia. Indiastands among the top 10 countries producing steel in the world. However, its global tradeonly accounts for only 2% of the global steel trade. Our domestic steel industry reportedrapid growth during the period between 2003-04 and 2007-08.

.

Availability of iron ore is a major challenge for the domestic steel industry. The totalproduction of iron ore is 70%-72% as fines and 25%-30% as lumps / CLO.

STRUCTURE / MARKET SIZE

The steel industry in India has been moving from strength to strength and, according to theAnnual Report 2009-10 compiled by our Ministry of Steel, India has emerged as the fifthlargest producer of steel in the world, and is likely to become the second largest producer ofcrude steel by 2015-16, more than doubling its capacity to 124 million tonnes.


6/38

Estimated Domestic Demand & Supply Balance 2011-12

Estimated Requirement of Raw Materials and Other Inputs by 2011-12

Input Materials UnitEstimated

consumption2005-06

Estimatedconsumption

2011-12

Additionalrequirement by

2011-12

Coking Coal Million Tonne 31.5 46.0 14.5

Non-coking Coal Million Tonne 15.0 24.5 9.5

Coal Dust Million Tonne Negligible 3.00 3.00

Injection

Iron Ore Million Tonne 66.9 130 63.1

Scrap Steel Million Tonne 10.2 18.0 7.8

Limestone Million Tonne 11 19.5 8.5

Dolomite Million Tonne 4.0 7.4 3.4

Natural Gas MCAL 10000 15000 5000

Ferro Alloys Million Tonne 0.85 1.5 0.65

Power MW 4120 7700 3580

In Million Tonnes

Products 2011-12

Demand Supply

Non-Flat 29 36.1

Flat 41.3 41.3

Total 70.3 77.4


7/38

Production

Steel production rose by 4.2 per cent to reach 60 MT in 2009-2010, according to the Ministryof Steel.

Moreover, according to the ministry, the crude steel production capacity in the country by2011-12 will be nearly 124 MT.

According to the Ministry of Steel, 222 memorandums of understanding (MoUs) have beensigned with various states for a planned capacity of around 276 MT. Major investment isplanned in the states of Orissa, Jharkhand, Chattisgarh, West Bengal, Karnataka, Gujaratand Maharashtra.

According to the Annual Report 2009-10 of the Ministry of Steel, domestic crude steelproduction grew at a compounded annual growth rate of 8.6 per cent during 2004-05 and2008-09.


8/38

Crude Steel Production

Year Crude steel production (in Mn. Mt)

Quantity Growth rate over last

year (%)

2005-06 46.46 6.96

2006-07 50.81 9.38

2007-08 53.86 5.98

2008-09 58.44 8.50

2009-10* 64.88 11.02

Source: Joint Plant Committee (JPC); * =Provisional


9/38

Existing Steel Capacity & Future Expansion

(C rude steel ca pacity in million tonne)

Inves tor E xis ting C apac ity B rownfield

expansion

2012

Greenfield

2012

Total

capacity

likely by

December

2012

S AIL 12.84 8.56 21.40

R INL 2.90 3.40 6.30

T ata S teel 6.80 3.20 3.00 * 13.00 *

E ssar S teel 4.60 3.90 6.00* 14.50*

J S W S teel 6.60 4.40 11.00

J S P L 2.40 4.80 3.25 10.45

Ispat Industries 3.60 0.60 4.20

Bhushan P ower & S teel 1.20 1.60 2.80

Bhushan S teel 0.80 2.20 3.00Others & S econdary 31.00 3.20 34.20

Total 72.74 35.86 12.25 120.87

S ource: Finmin

With additional capacity expansion, as shown above, surging imports from China are a

matter of great concern for the Indian Steel Industry.

Chinese imports may pose a major hurdle to Indian expansion projects, in addition to

logistics and infrastructural challenges.


10/38

Cost Competitiveness of the Indian Steel Industry

The cost of major raw materials like iron ore and coking coal are lower in India than in othercountries . Labour costs are low, but gains are somewhat neutralized by the low level ofproductivity.

The financial cost and costs of power, oil and some other materials are high. Energyaccounts for about 35%-40% of the cost of steel production in India whereas it accounts forabout 28% in developed countries. All these make the pre-tax cost of steel making in Indiahigher than that in South Korea, Australia, Mexico, and the CIS countries.

India has a definite advantage of having low wage rates. The wage rates and other related

costs accounts to 15% of the total cost of steel production, ie, almost half that of othercountries , where they are 30% of the total cost.


11/38

Overall Loss for India in Q1 2010-11

Heads where Losses were Incurred Loss in million US$*

Loss from Export of Iron Ore to China* 1037

Inventory Loss 316

Sales Loss 105

Total Gain / (Loss) 1458

In the period Apr-Jun10 , the Indian Steel Industry reported a loss of US $ 1458

million (excluding erosion in market capitalisation). In July10, prices were further

down by US $ 21.6 per MT ,eroding an additional million US $ 41.0 on sales volume of

1.8 MT of HRC.

In the same period ,China gained million US$ 1047 on cheaper imports of iron ore

from India.

*1 US$ = 46.23 INR


12/38

Loss for India on the Export of Iron Ore

Source : Metal Bulletin Research Weekly Raw Material Tracker

Note: US$ Rupee parity has been taken Average of Apr-Jun10 at 46.35

For the period Apr-Jun10 due to low price of Iron Ore China has gained

million US$ 1047.

This is also the loss incurred by India.

*1 US$ = 46.23 INR

Particulars China Import (63-63.5 Fe)

Import rate as on 01.05.10 US $ / MT 177

Import rate as on 29.06.10 US $ / MT 138

Fall in Price in US$/MT 39

Export of Iron Ore by India to China (Million Tonne) 27

Chinese steelmaker's/country's gain (Million US $) 1047


13/38

Current Expansion Projects

Bhushan Steel plans to invest US$ 5.72 billion in building 12 million tonne capacity in thestates of West Bengal, Jharkhand and Orissa.

Non-ferrous metals giant Vedanta Resources plans to invest around US$ 4.79 billion in a

5-million tonne steel plant in the Keonjhar district of Orissa, and envisages commissioningthe same by 201213.

Tata Steel is also planning to build a 5-million tonne plant in Chhattisgarh, with aninvestment of around US$ 3.59 billion. The steel major is setting up greenfield projects inJharkhand, Orissa and Chhattisgarh. In Jharkhand, it is likely to invest about US$ 8.38 billion

for a 12-million tonne integrated steel plant. In Orissa, it plans to put in almost US$ 4.39billion for a 6-million tonne capacity plant.

Mesco Steel plans to invest US$ 2.20 billion towards the expansion of two of its steel plantsin Orissa.


14/38

Current expansion plan

Reliance Infrastructure, (part of the Reliance Anil Dhirubhai Ambani Group) plans to build a12-million tonne steel plant in Jharkhand, which is likely to be completed by 2012.

Indian Railways plans to invest around US$ 437.25 million per annum for stainless steel forthe new alloy-made wagons and coaches it intends to add to its portfolio.

Welspun Gujarat Stahl Rohren (one of the larger steel pipe makers in India), plans toincrease the capacity of its pipe plant by 75%, to 1.75 million tonnes, with an investment ofUS $ 222.52 million.

The JSW group plans an outlay of US$ 40 billion for steel and power projects. These projectswill be completed by 2020.

Visa Steel has lined up a US$ 1.51 billion-US$ 2.02 billion integrated steel project inChhattisgarh.


15/38

Current Capacity Expansion

RINLVizag

UttamGalva

Tata steelJhknd

JSPL

SAIL,Bokaro

SAIL,Bokaro

SAIL,Burnpur

SAIL,Durgapur

BhushanSteel

SAIL,Bhilai

Arcelor-MittalOrissa

POSCO

TataSteel,KPO

ISPAT

SAIL,Rourkela

JSW

TataSteel CSP

JVSL

Essar,Surat

EssarManoharpur

Adhunik

SteelMittal,Jharkahnd

Tata steel,Jamshedpur

VisaSteel

JSW Major steel plants (brown & green fields) in India would be clusteredmostly around the red circle passing through three states rich in coal

and iron ore, putting severe pressure on logistics infrastructure.

BhushanSteel &Power


16/38

Investments

A host of steel companies have lined up major investment proposals. Furthermore, with an expandingconsumer market, the Indian steel industry is likely to receive huge domestic and foreign investments.

The domestic steel sector has attracted a staggering investment of about US $ 238 billion, according to theMinister of State for Steel, A. Sai Prathap.

This consists of nearly 222 MoUs signed between the investors and various state governments, mostly inthe states of Orissa, Jharkhand, Chhattisgarh and West Bengal.

SAIL is planning to set up a 12-million tonne plant in Jharkhand.

In December, Indias largest engineering conglomerate -- Larsen & Toubro (L&T) -- and state-ownedNuclear Power Corporation of India Limited (NPCIL) formed a US$ 373.2 million joint venture forspecialised steel and forging products.

Stainless steel manufacturer and exporter Varun Industries is setting up a US $ 171.8 million stainlesssteel-cum-alloy steel plant at Rohat, Jodhpur.

Tata Steel has entered into a joint venture with Japans Nippon Steel for the production and sales ofautomotive cold-rolled flat products at Jamshedpur.

This jv is expected to invest US $ 400 million to set up an automobile venture in India.

Steel major JSW Steel has earmarked a capex of US $ 1.6 billion for 2010-11, and plans toincrease thecapacity of its Bellary plant in Karnataka from 7 MT to 10 MT by the end of 2010-11.


17/38

SWOT ANALYSIS

Strengths Abundant supply of iron ore

Low cost and reasonable efficient labour force

Strong man ower capability and improving productivity History in steel making and acquired skill

Strongly globalised industry and emerging global competitiveness

Increases in productivity through the adoption of more efficient and cleaner technologies in themanufacturing sector will be effective in merging economic, environmental, and social developmentobjectives

Strong steel production base and achieved productivity levels

High degree of entrepreneurship Availability of investments and capital backup

Support from government , which helped in growth of the steel industry

The biggest boost to efficiency in the steel industry has come from the increased use ofcontinuous casting an indicator of the modernity of the production process.

Availability of a good railway network for domestic shipping


18/38

Weaknesses

Limited availability of coking coal

High transportation and handling costs

Mining costs are also high

Implementing the latest technology has become a concern for the Indian steel industry

The steel industry in India did not attain self sufficiency in constructing and efficientlymaintaining steel plants. It still relies on countries like Russia, Ukraine and Kazakhstan, etc,for installing new steel plants in the country.

Although India has modernized its steel making considerably over the past decades,nearly 6% of its crude steel is still produced using the outdated open hearth process.

Quality is also one of the drawbacks India needs to address. Quality of flat steel or longsteel is an issue for reaching international quality standards.


19/38

Weaknesses

Logistics is one of the constraints for Indias steel industrys competing in global markets.Our domestic steel industry has to concentrate on the supply of raw materials and meeting

the customers delivery time. The loading and unloading rates at ports, container handling,and in plant logistics also hamper the global success of the Indian steel industry.

A tonne of finished steel requires handling and transportation of around 4 tonnes of bulkmaterial, so the anticipated expansion of steel capacity, even accounting for delays, wouldexert tremendous pressure on Indias logistics infrastructure post the commissioning of

projects. The problem would get aggravated if future capacities show regionalconcentration, which is likely.


20/38

Opportunities

Huge increase in steel consumption will result in the tremendous growth of the steelindustry in the coming years

India has all the resources and capabilities to become a global supplier of quality steel

Low steel prices make imports from Russia, Ukraine and Kazakhstan attractive. Thegeographical proximity of Japan, South Korea and China makes them important suppliers aswell.

With the decreased potential for steel in developed countries, India has opportunities forbecoming the world leader in the production and supply of steel and iron ore

Concurrently, industries like automobiles and urban infrastructure are also growing..


21/38

Threats Infrastructure is a major problem for the steel industry in India. Insufficient infrastructure, in terms

of transportation and logistics, is becoming a growing concern for the Indian steel industry. Thegovernment is also planning to increase its share in infrastructure as part of the GDP, from 2.5%currently.

Huge competition in the global markets. In the Indian market, too, with the entry of foreignplayers, domestic steel producers are facing tough market competition.

Increasing concern for global climate change is becoming a threat to the industry. Countries arefocusing on the reduction in carbon emissions, particularly with respect to energy intenseindustries like steel, cement, etc. The steel industry accounts for between 5%-6% of total man-adeCO2 emissions. This is less than that accounted for by transport or power use by the general public,showing the steel industry is at the frontline in fighting global warming.

Future energy use and carbon emissions depend on the level of production and the technologiesemployed. Moreover, different economic and policy settings affect structures and efficiencieswithin the sector.

Issues with the dumping of low priced steel products from China and other countries is alsoanother hurdle in the growth of the Indian steel industry.

Infrastructure, with respect to steel plants and logistics of the steel industry, is alsoone of the key challenges for the Indian steel industries.


22/38

Challenges of Logistics in the Indian Steel Industry

High transportation costs: This is one of the major concerns as it is affecting the growth of theindustry. Due to problems in infrastructure and, also on account of low levels of productivity interms of handling and transporting cargo, the costs of transportation have risen daily.

Lack of connectivity to the ports, with sufficient rail and road networks, is also one of the causesfor high transportation costs.

Proximity and access to raw materials. Infrastructure requires to be developed to transport rawmaterials for steel production, for achieving the production goal of 75 million tonnes of additionalcapacity by 2019-20. There will an additional movement of 300 million tonnes of raw material.

The efficiency of Indian ports is affected by shallow draught, low productivity, high costs, longvessel turnaround times, poor governance, and lengthy Customs delays. Shipping costs areconsequently high a shipment from India to the United States can cost 20% more than it wouldcost from Thailand and 35% more than China.

Unlike international ports like Singapore and Rotterdam, the shortage of storage space inthe major Indian ports has further compounded the problem of speedy cargo evacuation

from port premises.


23/38

Steel Logistics Chain

Steel Plant RawMaterials/Supplies/

Sourcing

CustomerSecond Leg

Customer/Processing Agencies/Hubs

LP

LP: is Logistics Provider

LPs Role is to Deliver

right quantity at righttime without damage inorderly manner

LP

Steel Plant

Ports

Road RailLogisticsServiceProvider

Integration of Steel Logistics Chain


24/38

Typical Material Movement Plan at a Steel Capacity of 110 MTPA

State Iron Ore Cokong

Coal

Non Coking

Coal(For Sponge

Iron)

Thermal

Coal

Others Total

Raw

Materials

MTPA

Total

Steel

MTPA

Orissa 34 11 11 9 12 77 21

Jharkhand 38 17 3 8 13 79 21

Chattisgarh 25 9 6 6 9 55 15

Others 90 31 20 22 31 193 53

Total 186 69 39 46 66 405 110

Total raw material movement plan at 110 MTPA steel capacity will be 405MTbesides the movement of 110MT of finished steel.


25/38

Performance of Logistics in the Indian Steel Industry

Outbound logistics costs: Due to problems like an inefficient maintenance of cargo, theoutbound costs of logistics are increasing considerably. Outbound logistics costs include

costs of idle freight, detention, in-plant logistics, transaction costs, handling and storagecosts, lashing and bracing costs, etc.

In-plant logistics: In-plant logistics includes activities such as real time location visibilitylevels, in-plant wagon turnaround, in-plant truck turnaround, despatch spread, transitinventory, the in-plant route network, number of handlings, etc. These are activities whichare to be taken care of. The efficient operations of these activities will also reduce costs

considerably.


26/38

Challenges of Ocean Logistics

There are 12 major ports, 200 minor and intermediate ports, with the cargo basket moving away frombeing bulk cargocentric. Minor ports marketshare increased from 9.9% in 1997 to 28.8% in 2007. Majorsea ports accounting for traffic in steel and iron ore cargo are VPT Visakhapatnam,the ports ofChennai, Haldia, Paradip, Enore and others.

At almost all the ports, iron ore loading is a mixture of mechanical loading systems which consist of

conveyors, stack reclaimers and ship loaders, and a manual loading process using shore cranes andships gears and grabs. The existing mechanical loading systems are becoming old and obsolete, andthere is an immediate requirement for upgrading the infrastructure in the ports, particularly withrespect to the loading and unloading of cargo.

Only Vizag and Chennai ports can load alongside berths cape vessels upto 145,000-150,000 DWT, withdraft of about 16.5 Mtr. In Goa, at Berth No. 9, cape-size vessels can load only upto 100,000 MT toreach 13.0 Mtr draft. Thereafter, top-up at anchorage by barges or transfer vessels is required.

No rail connectivity to ports like Belikeri, Karwar, Krishnapatnam. Thus movement by trucks isinevitable.

Poor infrastructure at ports leads to high throughput time, high turnaround time for ships, slowerloading rates, delays due to break-downs, thus resulting in port congestions, higher incidence ofdemurrage costs and high costs.

Higher costs erode competitive advantage vis--vis exporters from other countries.

India is unable to derive full benefit of geographical advantage to export markets due to poor

infrastructure and high costs


27/38

Sea Ports India


28/38

Mitigation Plan for Challenges in Port Infrastructure

To augment the port capacities for gear up for higher exports of all commodities.

Modernization of all machinery and mechanization.

To develop higher drafts to take advantage of handling vessels of higher capacity with lowerunit freight costs.

To compress time lines in port projects implementation.

To match port capacities with rail-road infrastructure to remove bottlenecks.

To develop facilities for railway rakes, to go inside the ports for unloading / loading anddispensing with interchange/exchange yards to reduce cycle time.

Seamless movement in/out of port for both road and rail to cut down waiting time .


29/38

Challenges for Steel Rail Logistics

About 80% of the proposed steel plant capacities are planned in South Eastern, South East Central & EastCoast railway zones. This would require huge investments in: Augmenting capacities of yards / stations/signalling/laying several additional tracks / rail bridges /tunnels etc.

Adequate rolling stock.

Acquiring additional land / forest & environmental clearances.

Current fleet of 225,000 wagons can handle 750 million MT of traffic.

Wagon building capacity is higher but due to shortage of wheels and axles the output is limited. Withinduction of 12,000 wagons per year , traffic handling capability will be 1,200 MT , if overall turn aroundtime is achieved to be 4.5 days.

Considering steel traffic to be 15% of total Indian rail traffic, 180 million MT of steel traffic can behandled. If similar growth in other commodities continues the capacity will be inadequate.

Railway has decided to increase axel load (20.5t to 25t to 30t). It still needs to finalize rolling stock policy(type and design of wagons).

The above would require 5 to 10 years and might affect the time schedule of the mega steel projects


30/38

Challenges of Rail Connectivity

International railway systems carry more than 100 wagons per rake with the Australiansystem carrying over 300 wagons per rake. Compared to this, a rake in India handles 58 BOXwagons as the length of the loops in the yards and stations in India is only 686 m, limitingthe length of the trains. Even rakes of 58 wagons cannot be handled at sidings of some ports.The space envelope 82 in India does not permit the movement of double stack container

wagons. Since stations, platforms, roofs and bridges had been constructed according to thepreviously designed space envelopes, the envelopes of existing railway lines cannot beincreased, thereby limiting the carrying capacity of the rakes. Load carrying capacityexpressed as the ratio of a loaded wagon to an empty one ranges from 4-7 internationally asagainst 2.5 in India.

Some of the other challenges with rail connectivity are: Iron ore miners are forced to move out by road due to the lack of proper rail connectivity.

Sharing railway lines for both passenger and goods is creating a problem, resulting inpriority given to passengers and delays and congestions of good traffic. Low average speed of freight traffic leads to longer lead time and reduced throughput. Lower haulage capacity leading to higher lead time. Frequent changes in freight charges. Freight charges for iron ore are being targeted

for frequent hikes, leading to increase in costs for rail compared to the road.


31/38

Railway Freight from Mines Head to Visakhapatnam Port in USD/MT

From To

2000 2001 9.01

2001 2002 9.28

2002 2003 0.00

0 1. 04 .20 02 08. 07. 20 02 9.28

0 9. 07 .2 00 2 3 1. 03 .20 03 8.71

2003 2004 8.71

2004 2005 0.00

01.04.04 28.10.04 8.7129.10.04 26.11.04 9.43

27.11.04 31.03.05 10.16

0.00

01.04.05 30.11.05 13.06

01.12.05 31.03.06 13.06

0.00

01.04.06 30.06.06 14.36

01.07.06 31.10.06 14.65

01.11.06 31.03.07 15.23

0.00

01.04.07 30.06.07 15.03

01.07.07 30.09.07 15.33

01.10.07 30.11.07 17.1401.12.07 06.01.08 20.16

07.01.08 31.03.2008 21.42

0.00

0 1. 04 .20 08 14. 04. 20 08 28.11

1 5. 04 .20 08 21. 05. 20 08 18.61

2 2. 05 .20 08 30. 06. 20 08 13.72

0 1. 07 .20 08 30. 09. 20 08 12.83

0 1. 10 .20 08 12. 11. 20 08 13.72

1 3. 11 .20 08 31. 03. 20 09 14.53

0.00

0 1. 04 .20 09 30. 06. 20 09 14.53

0 1. 07 .20 09 30. 09. 20 09 13.58

01.10.2009 14.53

2009-10

2005 - 06

2006 - 07

2007 - 08

2008-09

Period Total

Freight


32/38

Mitigation Plan for Steel Rail Logistics

About 80% of the proposed steel plant capacities are planned in South Eastern, South East Central andEast Coast railway zones

This requires huge investments in augmenting capacities of yards / stations /signalling /l ayingseveral additional tracks / rail bridges /tunnels, etc

Adequate rolling stock

Acquiring additional land / forest & environmental clearances

Current fleet of 225,000 wagons can handle 750 million MT of traffic

Wagon building capacity is higher, but due to a shortage of wheels and axles , the output is limited.With the introduction of 12,000 wagons per year ,traffic handling capability will be 1,200 Mt if overallturnaround time is achieved at 4.5 days

Considering steel traffic to be 15% of total Indian rail traffic, 180 million MT of steel traffic can behandled. If similar growth in other commodities continues , the capacity will be inadequate

The Railways have decided to increase axel load (20.5Tto 25Tto 30T) , but need to finalize their rollingstock policy (type and design of wagons)

The above would require 5 to 10 years ,and might affect the time schedule of the megasteel projects


33/38

Mitigation Plan for Steel Rail Logistics

To include transportation of Iron Ore in Liberalised Wagon Investment Scheme Policy

Under the Liberalised Wagon Investment Scheme (WIS), issued by the IndianRailway Board on 15.04.08, transportation of Coal and Coke, Ores and Minerals,including iron ore, has not been permitted.

Thus, the policy does not give any advantage to the steel industry.

Few More Expectations from the Steel Industry

Railway sidings at major steel plants should be developed as assisted sidings withequal participation from the Railways

For repairs and maintenance of wagons, carriage and wagon depots should bedeveloped by the Railways at major steel plant sidings

Future developments of railway networks related to the steel industry should begiven utmost importance in the annual Railway Budget

Separate guidelines with equal participation are required from the Railways forelectrification/modifications of existing sidings having large volume of traffic


34/38

Challenges of Poor Road Connectivity

Width of highways is not sufficient for both passenger and goods transports to betransported in a proper fashion.

Maintenance of highways is poor. Much of highway maintenance is underfunded.

Lack of organized fleet owners, resulting in reduced quality and professionalism.

Improper road connectivity, resulting in longer lead times.

Reliability and cargo integrity with other modes of transportation are an issue.


35/38

Roadways - NetworkGolden Quadrilateral Project

East West Corridor

North South Corridor

Port Connectivity Projects

Source: -NAHAI

Indian Roads Length (Kms)National Hihways 66,790

State Highways 128,000

Major District Roads 470,000

Rural and Other Roads 2,650,000

Total Highways Length 3,314,790

North South Corridor 4,000

East West Corridor 3,300

Total Corridor Length 7,300

Golden Quadilateral Length 5,846


36/38

Roadways - Solutions

More Expressways and Highways should be constructed

More Highways should be made four- and six-lane

More Road Connectivity with remote areas for goods distribution

Road Maintenance should be done regularly, especially for heavy traffic roads

Use of an intelligent transport system, system of green channel, andrationalization of discretionary powers is required


37/38

Infrastructure will be a major challenge by 2020 at 180 MTPA of steel production.

Indian ports should immediately go for capacity enhancement as well as modernization of the existingsystem, including the development of deep draft for accommodating the capsize /super capsize vessels.

Railway infrastructure will become a bottle neck. More PPP projects to be initiated to expedite pendingprojects. Latest technology to be deployed and implemented.

Pipeline infrastructure to be the most common mode of transportation for Iron Ore fines andconcentrates.

Railway infrastructure shall be developed inline with the freight corridor from mines head to major portsto avoid congestion.

Infrastructure is a major challenge for the Indian steel industries . We need to form an apex body forfinancing the infrastructure and ogistics required for the total movement of raw material and finishedsteel by the year 2020.

Conclusion


38/38

infrastructural challenges in steel industry -best paper published in 4th international steel...

Documents