I am confident that the slump in the steel sector will bottom out soon. The impact on India has been lesser than that in the West. In 2011, global steel production grew at 6.2 per cent, but between January and July this year, it is down to one per cent.
During this period, output in India clocked 3.4 per cent growth while real consumption in the first quarter of this financial year grew at 7.8 per cent.
In steel, while global prices, both for flat and long steel, have dropped significantly, in India it has not been that bad. This indicates that India cannot remain insulated from the developments in global markets.
With GDP growing at 5.5 per cent, the sector needs to grow at about eight per cent. Real consumption growing at 7.8 per cent is a positive indicator.
Output growth has been affected by lack of availability of raw material and the weakening rupee.
We have received the approval of our shareholders to buy-back their shares. It is an enabling provision. There has been no provision in the Articles of Association of our company. So, we have made this provision and got this approved by shareholders. If there is a need or our Board decides, we can buy-back shares.
We are maximising our production and aiming at better growth. Three out of four coal blocks allotted to us are operational while we are trying to make the fourth functional soon. We are also trying for more coal blocks.
We will soon invite expression of interest for selecting mine developers and operators for developing Chiriya mines in Jharkhand, which holds proven reserves of over 1.8 billion tonnes and is among the largest iron ore mines in Asia.
We are planning to invest more than Rs 50,000 crore in expanding and modernising various projects in Jharkhand over the next decade. We will expand our Bokaro Steel Plant, set up new steel, power and urea plants in Sindri and increase mining activities across Jharkhand.
We are looking for partners for our plans in Sindri (a sick fertiliser unit that the government has agreed to hand over to Sail). We will convert the 910-bed Bokaro General Hospital into a medical college.
The process is on and initial clearances have been received.
Our talks with POSCO for a joint venture in Bokaro are expected to start very soon. We are also trying to get iron ore from Afghanistan, Australia and other countries. We have interest to take up more work in other areas of the Railways after successfully providing them materials for laying tracks up to five lakh kilometres.