The Central Government has set up an expert panel to help revive its loss-making state steel maker after a government review found the company to be far less efficient than its rivals despite spending more than $10 billion in the past eight years.
A review document, crticizes Steel Authority of India (SAIL) for everything from the use of low-quality raw materials to outdated technology, suggesting that its problems were not simply the result of cheap Chinese steel imports. SAIL, which has been overtaken by JSW Steel as India’s biggest producer, has posted seven straight quarterly losses.
This severe underperformance could derail the government’s target to triple steel production in the country by 2030. Steel Minister, Chaudhary Birender Singh, worried by what he called SAIL’s “unsatisfactory” output performance, has asked the panel to recommend a timeline for ramping up capacity at a “quick pace”, to find ways to lower production costs and to improve branding and marketing.
The panel, comprising top officials of various government ministries and SAIL, met for the first time this week and will be helped by Boston Consulting Group (BCG) in coming up with a revival plan for the company. They will set quarterly, six-monthly and yearly targets for SAIL.
Image source: ArcelorMittal Automotive website