One nation poised for dramatic economic growth is India, primarily because of its burgeoning steel industry. With prices rising and the demand for steel and products made of steel continuing to grow, the future for the industry looks bright.
Having had several consecutive years of growth in supply and demand, the Indian steel industry is rapidly becoming one of the world’s top players when it comes to steel.
Steel Industry Structure
The Indian steel industry is located primarily in the eastern, western and southern parts of the country.
As demand increases, foundries in the eastern part will begin to expand as more investment dollars are put into these facilities due to the abundance of raw materials available there. With imports increasing by an average of eight percent annually over the past decade, the industry is beginning to have an impact in the international steel market.
However, to sustain this growth it’s expected that several of the smaller domestic companies in the country will have to begin a series of mergers to improve the country’s ability to meet national and international demand.
According to figures found in the Indian National Steel Policy, steel consumption has grown by 12.5 percent over the last three years, thanks in part to a boom in domestic construction.
This growth is far ahead of the seven percent growth predicted by economic forecasters, and is expected to continue growing due to more than $1 trillion in United States construction projects, all of which will require large amounts of steel.
The Construction Boom
With an expected increase of 43 percent in domestic steel expected over the next five years due to construction projects, the Indian steel industry is getting noticed by more of the world’s major economies. In fact, demand is expected to stay so strong that some economic experts are predicting India’s economy may grow to be the world’s third-largest, behind only the United States and China.
The major reason for this growth is the construction boom currently taking place within India. According to figures published online at Your text to link…, the Indian government estimates more than 31 million new homes need to be built, along with 40 hotels, numerous sporting facilities and office buildings. Infrastructure projects such as railways, bridges and road construction will also lead to an increased demand in steel, keeping the market strong for years to come.
Additional industries within mechanical engineering and automotive production will also lead to increased demand for steel. As the Indian economy gets stronger, consumers will be able to purchase more products such as automobiles, appliances and other items made from steel, leading to increased demand and profits.
So while it has taken many years for the Indian steel industry to take its place among the world’s best, current data suggests it has established itself as one of the fastest-growing and competitive markets in the world.