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AIIFA view on quality control order

Secondary steel sector is a confederation of secondary or non integrated producers which include Induction furnace Manufacturers and Re-rollers of Indian Steel.

The secondary steel industry in the country is an indispensable player for its economic growth, be it manufacturing sector, infra structure development, construction industry or the engineering industry. It is also a fact that the backbone of economic development of any country always remains with SME sector, which produces the steel products at the lowest possible cost, at lowest possible investment, maximum employment, and maximum engineering export if the basic inputs are available at fair prices.

The secondary steel sector accounts for 40% of the total finished steel products in the country and more than70% of the long product manufactured in India. It has played a major role in the steel economy of the country. The induction furnace industry helps in controlling environmental pollution by reusing the disposed steel scrap and reducing the burden on natural resources such as coal, iron ore etc.

Quality Control Order by Steel Ministry Dated 12.03.2013
Indian Government on behest of BIS has been trying to bring the steel industry under mandatory BIS license from the year 2007. Earlier the order for the same was published via ministry of consumer affairs, Food and public distribution. After postponing it for 5 years (from the year 2007 till year 2012), after which the same order was published in gazette of India by steel ministry in March 12,  2012. The order is now to be implemented in two phases first in September 12, 2012 and second in March 31, 2013.

During this long tenure continuous meetings between the steel ministry and industry has taken place wherein the industry had welcomed this decision but had requested the ministry to first provide some necessary basic infrastructure and R&D before implementing the order (for e.g. providing Testing labs across the country, Providing newer technology through which percentage of sulphur and phosphorus can be controlled, providing good quality of raw material such as sponge iron etc.)

At every forum secondary steel industry has underlined the importance of increasing the quality of steel products and has requested steel ministry to help them by conducting necessary R&D etc.

Now suddenly in the year 2012, the steel ministry vide order dated 12.03.2012 has made BIS mandatory for all manufacturers with provision of penalty and prosecution for the defaulters.

Salient problems with the Quality Control Order by Steel Ministry Dated 12.03.2013

  1. Sponge iron code not implemented even though sponge iron is one of the basic raw material of induction furnace and one of the major factors responsible in increasing the sulphur and phosphorus % in steel, the draft BIS standard (code MTD 30 (5174)) specifying the minimum quality of sponge iron is yet to be implemented, even though the code is under draft for a long time and final comments on the same have already been received by 31.08.2012 the sponge iron code is yet to be issued. Now with the Quality Control order the secondary steel manufacturer is bound to produce the steel with specified percentage limits of Sulphur and Phosphorus but the same are not mandatory for the sponge iron manufacturer & supplier.
  2. Time for R&D already allotted by Core Group Ministry of steel has formed a core group (having representation from Ministry of Steel, NISST, CSIR-NML, AIIFA, CMSPA and industry & associations) to study & suggest R&D proposals for containing percentage of Sulphur and Phosphorus in steel produced by Induction Furnace. In the second meeting of the core group held on 19.02.2013 a decision has been taken to provide NISST a time of 18 months to develop an effective method of controlling the sulphur and phosphorus percentage in steel produced through induction furnace.
    In addition to above R&D project by NISST another R&D project is already under progress in Ahmedabad on Development of route for steel making technology in CONTIFUR using DRI.

    The present implementation date of Quality Control Order has not given due weightage to the core group decision and seems to be in haste.

  3. Government to provide testing labs Secondary steel industry has time and again requested steel ministry to provide testing labs at major steel hubs since the same are in high scarcity and are required to authenticate the test results as required under BIS license. Even though the Ministry of steel has accepted the proposal to provide model testing labs under industry/ association collaboration at two locations namely Raipur and BHIWADI the same has not been implemented till date. After implementation of the present Quality Control Order there is no facility available to have a third party testing done which will create huge problems in day to day working of the industry.
  4. Permission of importing HMS grade I&II scrap from all ports & ICD’s At present as per order from Government of India the import of scrap is only allowed at 26 ports / ICD’s, this order has resulted in huge decrease in high quality Scrap with many areas such as Raipur etc. left to produce steel using local resources (DRI) only which are of very inferior quality. Before implementing the present Quality Control Order the industry requests the permission to import scrap at all ports/ ICD’s so that good quality scrap can be made available in abundance.
  5. Time required by BIS to give response on license application even for the units that had applied for License in April 2012, BIS has taken almost 1 year to respond to them and that to in rejection. Considering the time frame required by BIS to study and give response on any file the industry requests be given at least 5 years to get the license as being a first time process many units may require 2-3 times to get the license.
  6. Why to bring under license, use ads just like for tobacco productsit is being said by the government that since the common man is not aware of the quality of steel that should be used in construction hence it has become mandatory to bring the steel industry under compulsory BIS license, but in case of tobacco products etc. even after knowing that the usage of these products is harmful for the health of common man the same have not been banned instead the harmful effects are being advertised. The industry requests the government to reconsider their decision to bring steel under mandatory license and instead give ads in media cautioning common man not to use steel without BIS mark and leave the final decision on the common man.

Secondary Steel industry has always supported advancement in technology and quality of steel and steel products. Because of this commitment only the industry quickly adapted themselves from ROUND BAR to RIBED BAR to TORR STEEL to TMT Fe415 to TMT Fe500 to TMT Fe550 within a span of 25 years (without any quality control order) and are still improving and evolving based on market demand and social responsibilities towards human life and public interest.

Steel is used in many forms in various industries and in many industries such as infrastructure it is possible for engineers and architects to design safe structures even with lower quality of steel (though undesirable and presently uneconomical).

Considering the huge impact of steel in economy of the country and many problems envisaged to be faced by the industry by implementation of this order in haste, the industry once again requests steel ministry to review the present order before implementing it on the present declared date.

View compiled by:-
Mr. Kamal Aggarwal
Sr. Vice President AIIFA

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