Nationwide campaign needed to promote use of steel in construction

Written by Sushim Banerjee | Sushim Banerjee | Updated: Aug 13 2014, 07:14am hrs
The US president has announced a $300-billion package for improving transportation infrastructure in the country. This would significantly reduce the cost of delay estimated to be $40 billion annually in shipments of cargo, passenger travel. It will also raise safety and productivity in logistics. The stimulus package in the form of fresh investment would be implemented against the backdrop of current interest rate of 2.5%, unemployment level of 6.1% and current account balance of (-) $406 billion (2.3% of GDP). For raising the fund, Barack Obama has hinted at tough measures.

The US steel industry is enthusiastic about the development as this massive government procurement in building of roads, rail, shipping and airways with foreign content rule in vogue, would lead to significant rise in indigenous demand for steel. Further, the tariff protection through a spate of anti-dumping, countervailing measures has already shut the US market to a good number of steel exporting countries like China, Korea, Japan, Turkey, Russia and India.

In addition, the US transportation department annou-nced a 2-year phase out of the older and weaker legacy Track Cars, which means about 2,28,000 track cars would either be replaced or retrofitted to meet the new standards. It has also advised the US Association of Structural Engineers to find out structurally deficient bridges and suggest best methods of construction of these bridges, including ROBs.

This is a classic example of the government joining hands with the industry to solve the problem of bridge safety. In India, the crumbling of flyovers or damages in base structure prompt the government to reconstruct them but the steel industry, unlike the US, does not feel the urge to convince the government to opt for steel concrete composite bridges.

A study from the Netherlands has revealed that steel is more than twice as sustainable as other construction material and therefore should become a critical factor in selecting construction material.

As steel is more recyclable compared to its competing materials, it should always be preferred in large constructions, especially from the point of view of conservation of materials, resources and environment. We need a nationwide campaign for promoting use of steel in construction and building infrastructure. Simultaneously, designers, architects, construction companies and material purchasers need to be assured of timely supply of the nominated profiles at competitive prices. In Japan, the government has worked out a rebuilding plan of the northeastern areas devastated by earthquake and tsunami. We often mention a figure of $1 trillion of planned investment in the infra sector in the 12th Plan period . Recent data (compiled by Feedback infra) indicate the country has spent in the first two years of the 12th Plan a sum of R2,25,880 crore, which is about 79% behind the target of infrastructure expenditure fixed for these two years.

Actual expenditure includes central plan outlays and aid to states and UTs on infrastructure. This year, budgetary allocation of around R1,53,000 crore for the infrastructure sector stands at not more than 13.6% of the original annual target. Although banks have been permitted to borrow capital via bonds and lend it to meet the viability gap of long-term infra projects in a restructured, user-friendly method of repayment over a longer time perspective, the gap between requirements and government resources is to be met from other sources like private corporates, FDIs and ECBs and also unutilised funds lying in various saving schemes.

The author is DG, Institute of Steel Growth and Development. The views expressed are personal