India’s Ministry of Steel is working on a scheme to make borrowings from commercial banks easing for secondary steel producers, a government official said on Tuesday, April 11.
Although the official said that it is too early to give the specifics of such a scheme, it will be based on a system of government ranking of various secondary steel producers according to different parameters and commercial banks will be expected to take such rankings into considerations in determining terms and conditions for extending loans to such secondary steel companies.
The idea is the higher the ranking achieved by a secondary steel company, the cheaper will be the cost of borrowings extended to it by commercial banks, the government official added.
This is one of a slew of measures being considered by the government after its policy decision to aggressively promote secondary steelmaking over large integrated steel projects in the country.
India’s Ministry of Steel has taken a decision to promote the secondary steel sector adopting the US model of ‘melt and manufacture’ given the advantages of energy efficiencies and lower land requirement of the secondary steel sector.