The Indian government will not push for mandatory use of galvanized steel to the extent of 70 percent of all automobile bodies and parts without a further detailed study of the proposal framed earlier this year, a government official said on Thursday, November 15.
The official said that, in response to various submissions from automobile manufacturers, the Ministry of Steel will need to prepare detailed reports on changes in the cost structure of what such a move would force upon automobile manufacturing, as well as on the domestic availability of galvanized steel.
The government, after detailed perusal of the mandatory 70 percent usage of galvanized steel, felt that it will be counterproductive if such a policy is made mandatory risking the fall-out of a sharp surge in demand for domestic galvanized steel and thereby forcing automobile manufacturers to increase import shipments for such grades of steel, the official said.
Earlier in the year, the Ministry of Highways and Surface transport suggested making it mandatory for automobile manufacturers to increase usage of galvanized steel to 70 percent of all automobile bodies and parts from around 30 percent at present, to prevent losses owing to corrosion and in line with global practice.
The detailed report to be prepared by the Ministry of Steel will investigate the cost benefits of such a move including availability of raw materials, capacities of domestic steel mills to make necessary supplies to auto manufacturers, data-based analysis of losses from corrosion, and the terms of warranties offered presently by automobile manufacturers, the official added.