Geography
State the difficulties experienced by the iron and steel industry in India.
Mineral Based Industry
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Answer
The difficulties experienced by the iron and steel industry in India are-
- Capital intensive — Huge amount of capital is required by the iron and steel industry and the plants have a long gestation period.
- Obsolete technology — The machinery being used in the iron and steel plants is outdated.
- Limited availability of Coking coal — The coal reserves of India are limited. Many steel plants import coking coal.
- Sick industrial units — Due to inadequate supply of power and sharp increase in the cost of raw material, many steel plants are experiencing sickness or have been closed down.
- Control of Prices — The government has fixed the price for iron and steel which leaves little margin of profit for the manufacturers.
- Inefficiently managed public sector — Many public sector plants are facing strikes, lockouts, energy crisis caused by heavy investment on social overheads, poor labour relations, inefficient management and underutilisation of capacity.
- Heavy demand — To meet the increasing demand, large quantity of iron and steel has to be imported.
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