WHY INVEST IN JHARKHAND?
Jharkhand has been integral to industrial growth
1907
1910
1923
1925
1927
1948
1950
1953
1957
1958
1959
1961
1964
1985
1962- 1968
1975
1998
1999
1995
2003
Steel Works set up at Sakchi
Jharia Division begins operations
The Tinplate Company of India is established
Noamundi Mines commence supply of iron ore
Tata Pigments is formed
West Bokaro collieries acquired by Tata Steel
Tata Motors establishes plant in Jamshedpur
Indian Tube Company is set up, now a part of Tata Steel
Uranium Corporation of India established
Heavy Engineering Corporation
MECON Ranchi established
TRF Limited set up by Tata Group
Bokaro Steel Plant commences operations
Tata Sponge sets up base in Joda
Tayo Rolls, Tata Growth Shop and JAMIPOL
Central Coal Fields formed, a miniratna company
Timken establishes base in India
1991 Indo Danish Tool Room established
Tata Power sets up thermal power plant
Tata Steel takes over ISWP
Since its creation the state it has set in place a
range of enablers for investment
Physical and social infrastructure
Resources/Inputs
Availability of raw materials and natural
resources
Condition of physical infrastructure such
as power, water, roads, etc.
Skilled and cost-effective labour
Information infrastructure such as
telecom, IT, etc.
Labour market flexibility
Social infrastructure such as educational
and medical facilities
Labour relations
Regulatory framework
Investment
climate
Procedures for entry and exit of firms
Industrial regulation, labour regulation,
other government regulations
Certainty about rules and regulations
Security, law and order situation
Incentives to industry
Tax incentives and exemptions
Investment subsidies and other incentives
Availability of finance at cost-effective terms
Incentives for foreign direct investment (FDI)
Profitability of the industry
Jharkhand is a leader in key industries
•With expertise in geology, mining and immense power potential, Jharkhand
has the potential of becoming the most financially viable state in the country
PARTNERING GROWTH IN THE STEEL INDUSTRY
Growth in Global Apparent Steel Use is expected
to be steady
Effective crude steel capacity (Mn.T) in 2011 (f)
Apparent steel** demand in Mn.T (yoy % growth)
CIS
NAFTA
11%
EU - 27
6%
5%
8%
4%
9%
China
5%
5%
China
140
185
161
India
Asia, Oceania &
Africa Rest
(ex-China)
of Asia
C & S America
7%
818
14%
13%
8%
6%
8%
86
62
**ASU depicted is for carbon + alloy steel
Source: WSA, SRO_April 2011
429
The total demand will be 1.44bn mt in
2012, a growth of 6% over 2011
Belief in the potential of the steel industry in India
China and India are the centres of economic growth and
Steel demand: GDP growth estimated between 8-10%
in the next 3-5 years
Strong Steel demand in India: 10-12% on back of
robust growth in Auto and Construction
India is an attractive destination for both imports and
setting up of new facilities: by 2015 ~ 55 mt of capacity
is expected to be added by domestic steel companies
as well as the global players
Steel is the backbone of the India Growth Story
To achieve its growth targets India will need steel
India’s per capita consumption is 30 kgs of steel
India’s steel consumption is expected to reach 300 mtpa by
2025, it has set a production target of 110 mt by 2020
India needs one integrated steel plant every year, for next ten
years to meet its demand
Indian steel demand is expected to grow at ~8-9% in FY’12
Major steel consuming sectors are expected to post lower growth rates in FY12…
Carbon steel ASU* (Mn. T)
Growth rates yoy (%)
11%
Auto
25.0%
27.5%
12.0%
8.5%
67.3
62.1
56
6.5%
8.1%
8.5%
Constn
Cap Gds
10.0%
Consumer Durables
15.0%
14.0%
11.0%
FY10
FY11
19.2%
26.2%
FY12 F
Drivers for change
•Revisions in sector growth rates are based on slowing economic momentum due to inflationary pressures, high
borrowing costs and global economic turmoil.
•As a result of expectations of lower sector growth rates and changes in other macroeconomic parameters steel
demand growth for FY12 is downgraded slightly to ~8-9%.
* After JPC’s revised estimates added ~ 3 MT to FY10 ASU
The steel industry is expected to be a driver of
economic growth in India
Revenue and Employment
1 job in steel industry= 3 additional direct + 3 indirect jobs
Environment
Statutory norms
Competitive industry
demands efficient
technology
Socio-Economic Impact
Socially Responsible
Companies
Better Health, Education
and living standards
It is the first and fastest to
provide return on investments
and further value creation
Steel is leading the change for
mineral based industries
The steel industry is expanding
markets through new age
applications and growth through
operations in diverse geographies
Steel is 100% recyclable
therefore it is a sustainable
industry
The steel industry is a growth multiplier
given the opportunities it generates
for Allied Industries
Manufacturing
Spares (Mech / Elect / Hydraulic etc.)
Steel Service Centre
Slag Cement
Sponge iron
Rolls
Pumps
Tools & Tackles
Mobile Equipment
Foundry & Forge
Lubrication oils
Rubber Belts / Cables
Safety appliances
Stationary items
Furniture
Paints
Power generation & distribution
Service
Handling agents / Couriers
3 PL
Transport contracts
Maintenance -contracts
Hospitality
Medical
Retail
Realty
The 12th Five Year Plan has given impetus to the
steel industry
Proposed investment of around US $ 1 trillion in infrastructure in
the 12th plan, half of which would come from the private sector
Efforts to increase the share of manufacturing sector from 15 per
cent to 25 per cent of GDP by 2020
This will lead to high demand of steel
It will be a challenge to meet the targets of the 12th Five Year Plan
India's steel demand is likely to grow 10.3 per cent per annum, and
will reach a level of 113 million tonnes by the terminal year (2016 17) of the 12th plan
In a business-as-usual scenario, domestic supply of steel will
significantly fall short of domestic demand
Growth plans of the global steel industry for India
Key enablers for growth of the steel industry in India
National Mineral Policy emphasises:
The need for conservation and judicious exploitation of finite
mineral resources through scientific methods of mining,
beneficiation and economic utilisation
Development of mineral resources by taking into account national
and strategic considerations
To ensure adequate supply and best use keeping in view present
needs and future requirements
To ensure indigenous availability of basic and strategic minerals to
avoid disruption of core industrial production
Key enablers for growth of the steel industry in India
National Steel Policy is expected to be released soon.
The task force has brought together stakeholders from
all areas
The policy will focus on regulatory hurdles, taxation
issues and infrastructure bottlenecks
It will look into boosting capacity expansion due to
soaring imports and to address issues which are
hindering capacity expansion
Measure for optimum utilisation of raw materials
including beneficiation
Jharkhand Industrial Policy’s focuses on growth of
mineral based industries in the state
Features specific to the Mining and Minerals Sector
• Simplify procedures and expedite granting of mining leases
• Provide certain relief to make mining activities easier
• Encourage use of modern exploration techniques to set up a
resource inventory of various minerals in the State
• Encourage joint venture projects with State Mineral Development
Corp
• Clear mining lease applications and project report within 60 days
• Encourage Foreign investment and technological collaboration by
OCBs and NRIs in selected sectors including Mineral
development
• Encourage Private Sector participation in Mining Activities
Source: Jharkhand Industrial Policy 2011
According to the steel ministry assessment report:
Of the 22 MEGA steel projects planned
eight are located in Jharkhand
– the maximum for any state in India
Growth of the contribution of steel and steel
based industries industrial value
• Iron and Steel accounts for more
than 50% of Jharkhand’s industrial
out put.
Share of industries
21.03
7.7
56.02
15.25
Iron & Steel
Auto & Auto Components
Coke oven product
Others
 Steel industry has grown by 24% in
the last decade
 Auto and it’s ancillaries which use
steel as a principal input have
become the second largest
contributor to industrial output.
 Further growth and Value Creation
can take place if idle mineral
resources are utilised
The investments which have led to this growth
26 mega industries, 106 large and medium industries and 18,109
micro and small industries have been set up
The approximate value investments is Rs 28,424.06 crore
Industries have been able to acquire about 8,000 acres of land
through direct negotiation with raiyats; the State government has
provided 3000 acres of land
Around 17 mega industries have already come into production and
several other industrial units are likely to be commissioned during
the financial year 2011-12
Steel production in the State has increased from 8 million tonnes to
over 12 million tonnes per annum during the 11th Plan period
Source: Jharkhand Industrial Policy 2011
Why Jharkhand is seen as an emerging steel hub?
Steel is leading the change for mineral based industries
25% of the steel produced in India is made in Jharkhand
The proposed projects by Tata Steel, Bokaro Steel, Essar, etc will
add 25 MTPA to steel making capacities in Jharkhand
An Auto Cluster is being made operational at Jamshedpur
An Automobile Vendor Park will be established under PPP or
Private Mode by Mega Automobile Manufacturing Units
Skill development and training in activities like driving, vehicle
maintenance will receive financial support from the State
In 1867 J.N. Tata attended a lecture by Thomas Carlyle
(British writer) in Manchester. Carlyle's statement "the
nation which gains control of iron, soon acquire control of
gold" had a profound effect on J.N. Tata, exposing him to
the idea of setting up a steel mill in India.
He chose Jharkhand - we believe you should too