9 Problems Faced by Iron and Steel Industry in India

There has been a rapid increase in the total production of pig iron and steel in our country during the last 50 years. There has been an increase of more than 10 times in the output of pig iron, more than 15 times in the steel ingots and 22 times in the finished steel during the last fifty years. India produced about 41 lakh tons of pig iron and about 500 lakh tons of finished steel in the year 2008-2009.

Problems of Iron and Steel Industry in India:

i. The iron and steel industry requires huge capital investments, which a developing country like India cannot afford.

ii. Most of the public sector plants are functioning inefficiently and thus incurring heavy losses.


iii. The per capita labour productivity in India is one of the lowest in the world.

iv. The under-utilisation of capacity leads to high cost of production. This is mainly due to strikes and lockouts.

Iron and Steel Industry in India

Image Source:

v. The old technology needs to be updated and this needs very heavy investment.


vi. The control of prices by the government leaves very limited profits for future upgradation.

vii. The high-grade coking coal reserves are limited and India has to import coking-coal at market rates.

viii. Our old technology of smelting and steel making is expensive and yields inferior quality products.

ix. There is a limited demand for our products in the world market.

time web analytics