India ready to join OECD steel panel

India ready to join OECD steel panel

New Delhi: India made it clear it is ready to join the OECD’s Steel Committee provided no additional conditions are imposed “over and above" the obligations under the World Trade Organization on 27 December.

“We have received an invitation to join the Organization for Economic Cooperation and Development (OECD) Steel Committee. We are ready, provided no conditions are imposed over and above the obligations under the WTO," Secretary, Steel Ministry, Raghav Sharan Pandey said.

“Once they agree to this we have no problem in joining," he said.

With its 30 members and observers including India, China and Russia, the committee accounts for 65% of world steel production and 80% of global steel exports. China, which has also been invited to join the Committee is considering the same, while Russia is understood to have assented.

“Though we have observer status in the Committee currently, in view of our massive capacity expansion plans, we are slated to be the world’s second biggest steel producing nation in the next few years. That is why OECD wants us to be a part of this committee," Pandey reasoned.

“We are surging towards achieving steel production of 124 million tonnes by 2011-12. Even if we achieve 90% capacity utilization it will be 110 MT," the Secretary said.

In India, production figures have been revised upwards, making the country the fifth largest producer in the world last year. “Indian production continued to increase rapidly this year, driven by strong demand," the Committee’s Chairman Risaburo Nezu observed in Paris earlier this month.

Nezu said consumption in India is also growing at a double-digit pace, though it is at a much lower level of around 45 million tonnes.

Over the years, OECD has emerged as a unique platform where multilateral steel problems are discussed and political solutions to these problems found.

However, China continues to drive world production developments. In the first 10 months of 2007, Chinese steel production reached 409 million tonnes, up 18.1% from a year earlier, growing faster than domestic demand. This brings its share of world production to 37%, up from 34% in 2006, Nezu said.

The BRIC economies (Brazil, Russia, India and China) are leading the growth of world demand.

“Crude steel production is on track to grow by 98 million tonnes in 2007, or 8%, to reach 1,330 million tonnes. Weaker growth in North America and the EU is being offset by rapid production expansions in emerging economies," he pointed out.

The EU is seeing a slowdown in production growth this year as imports take up an increasing share of domestic demand. Solid growth is still being seen in Germany, while output levels have either stagnated or fallen in Italy and France, he said.

“In the CIS countries, growth in steel making activity is maintaining momentum, led by Russia and the Ukraine. In Russia, the booming oil and gas industry and growth in household income continues to stimulate demand for steel," Nezu said.