Indian Steel industry owes Rs 300,000 crore to banks
The prices of steel have fallen due to cheaper Chinese steel in the market, and this has resulted in the domestic steel producers suffering heavy losses. The Indian steel industry is facing outstanding loans of around Rs 3 lakh crore in various banks, thus making the sector one of the largest contributors to Non-Performing Assets (NPA) in the country.
However, the government has imposed a Minimum Import Price (MIP) for steel which has helped the price again go upward in the last two to three months. It is also making efforts to revive the industry so that the steel companies repay loans. As per reports, Birender Singh, Steel Minister has said that the banks have to make efforts to restructure the loans given to the steel industry so that they are recovered.
Sources reveal that China has produced 25 to 30 per cent more steel than its domestic consumption and the country has been trying to export steel to India where its demand is growing. Reports also indicate that the Indian steel industry is currently passing through a severe downturn, due to global overcapacity, as a result of which, the steel producing countries often lower than their cost of production.