Fastener Manufacturer Association of India discuss about steep increase in prices of Iron & Steel; Writes to PM

Ludhiana, January 5, 2017: An emergent meeting of Fastener Manufacturer Association of India took place to discuss about the steep increase in the prices of Iron & Steel. It was unanimously decided to write a letter to Prime Minister of India with a copy to Finance Minister & Steel Minister to take immediate steps to roll back the price increase by main steel producers failing which we shall start state vide agitation.

The letter reads as under "Fastener Mfrs. Association of India(Regd.) an apex body of Fastener manufacturing units located almost all over the country mainly in Punjab, would like to submit that people have now started believing that economics is becoming irrelevant before politics. The economics is being mixed with politics and it has become dangerous particularly in the matter of handling of Steel prices. Recently the main steel producers increased the price of steel by 7000/= PMT in last two months, whereas there is no significant increase in the prices of inputs which can affect steel prices. This is the clear evidence of cartel by main steel producers & local steel rolling mills have also followed the suit and increased prices with same ratio. We would like to add that after demonetisation, our productions came down by 60 -70 % & with steel price hike MSE’s are on the verge of closure.

The state of Punjab is already suffering a great loss due to its far away location from the steel producing states have to pay more freight on the iron and steel material because of withdrawal of freight equalization scheme and thereafter have to sell the products in the same states for which again more freight have to be paid. Now with the unprecedented steep hike in the steel prices the entire engineering industry of the state have come on the verge of closure and the Government is not paying any attention towards this destruction of the Industry of the state. The Industry was expecting that some stern steps would be taken to check the prices of Iron and Steel in the Union Budget, 2016-17 by framing Steel Regulator but nothing concrete has been done in the Budget.

The steel prices are rising abruptly without any justification. Steel prices are not supposed to rise as there is no hike in the prices of inputs for the Steel Industry, but they are made to rise with the blessings of the Government to the Steel producers.. Sir Hoarding is unlawful and an anti social act. But Steel producers are achieving the effect of hoarding through legal means. They are exporting the Steel to other countries to create scarcity in the country and the secondary steel producers sell the material on the rates as per their sweet will. Our association as well as large number of other engineering industry associations have taken up the matter with the Union Government. We have also met the Hon’ble Prime Minister and Union Steel Minister time to time but nothing has been done to have a check on the prices and give a relief to the Industry.

You are well aware that the Iron and Steel material is used in every sphere of life by a common man. Even in residences a large number of domestic articles made from Iron and Steel are used. More over Iron and Steel material is used by every body in the construction of house whether he is a poor man or rich man. With this hike in the steel prices, the life of every body has become very tough

We therefore request your worthy self to please intervene and take up the matter with the Government of India to take some immediate steps to save the Engineering Industry of the country. We suggest the following remedies and request your worthy self to kindly take up the same with the Government of India with your favourable recommendations for earliest solution of the problem:-

Withdraw MIP immediately so that we can import material to counter Cartel of main steel producers.
Impose immediate ban on export of Iron Ore and Semi Steel Items i.e. Ingots, Billets, or impose 20% Export Cess on export of these items as China has done to save their domestic Industry.

Break the Cartel of the main producers and roll back the increase in the prices immediately.

Re-introduce the Freight Equalization Scheme for Iron and Steel so that the Industry of Punjab could be saved.

We earnestly hope your goodself will be kind enough to intervene and take up the matter with the Government to take immediate action in the matter and save the Industry of the country."