Articles
Analyzing the Impact of COVID-19 on the Indian Steel Sector
by Anika Dixit BloggerEven the most thrilling climax of any movie would not have dared to portray a world encompassed by a complete lockdown. A deadly pandemic COVID-19 has achieved the impossible. Nothing less than a horror movie, COVID-19 has run wild wreaking havoc throughout the globe, filling hospitals and emptying roads. The best way to deal with it is by practising social distancing which has caused a worldwide lockdown. This is definitely bad news for the economy but health comes first.
On 12.4.20, the World Bank estimated that the Indian economy would rapidly decelerate @5% in the year 2020 and the impact will continue till 2022. The Indian steel sector has witnessed a massive rise over the last decade and a chunk of the credit goes to top 10 steep companies in Andhra Pradesh. Steel has always been one of the most important materials for construction. The overall lockdown has severely impacted regular production by putting a restriction on transportation. A vast majority of steel companies in India have displayed resolve and continued production braving the pandemic at a reduced rate.
Steel is one of the pillars of the Indian economy. As a result, steel production and associated activities such as mining are being covered under the Essential Commodities Act. Top steel companies like Tata Steel have already reduced production during the lockdown phase. The rapid fall in the demand for steel due to lockdown will result in a sudden spike in steel prices. This has a global implication as steel accounts to 68% of India's net metal exports and 63% of the net metal imports. China, where this disease originated is India's largest steel provider. A disruption in the Chinese industry will force the active players in the Indian steel industry to settle for other options. As a matter of fact, we can see a substantial amount of steel imported from countries like Turkey and Brazil in the near future. One of the biggest challenges faced by steel industries is the maintenance of the machinery. The production equipment used for production can be jammed down if it is left idle. This can provide huge financial losses. As a result, many companies have kept their production units ready. There is no denying the fact that logistical issues coupled with lack of demand have halted the Indian steel sector.
This is true that it is a rough phase but it is all due to the situation. Every industry has suffered economical losses and it can hardly be avoided. All these do not take away the fact that steel still has immense potential and the future is still bright. Even during these harsh days, robust steel solutions are being used as isolation wards. The top 10 steel companies in Andhra Pradesh are current working round-the-clock to support the economy by ensuring a seamless supply-chain.
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About Anika Dixit 
Blogger
89 connections, 3 recommendations, 341 honor points.Joined APSense since, October 21st, 2019, From kolkata, India.
Created on May 18th 2020 05:18. Viewed 250 times.
