As the Modi government aims to position India as a global manufacturing hub, foreign investment inflows are reaching new heights. Societe Generale, a financial services group based in Europe, has acquired a stake in Rama Steel Tubes, a leading steel pipes manufacturer.
According to BSE data, Rama Steel has signed an agreement with JSW Steel, one of India’s largest steel manufacturers, to procure hot rolled coils, which are used in the production of steel tubes and pipes.
This development is significant as the demand for steel and related products in India has consistently grown over the years, defying the gloomy global demand.
The Indian Steel Association (ISA) predicts that steel demand in India will continue to expand by 8-9 million tonnes. During 2023-24, steel demand is expected to reach 128.9 million tonnes, up from 119.9 million tonnes in the previous year, driven by increased demands from the domestic construction, railways, and capital goods sectors.
The MoU also designates Rama Steel as the official distributor partner of JSW Steel for hot rolled coils in the entire western region.
“The MoU brings several competitive advantages as it grants access to high-quality raw materials and improves the procurement process, ensuring efficient and timely sourcing, thereby enhancing our supply chain management capabilities,” stated Rama Steel in a SE filing.
According to ISA, the steel sector has benefited from India’s robust economic growth, and increased consumption is expected in industries such as automotive and consumer durables. India is the world’s second-largest crude steel producer, with a total output of 125.3 million tonnes in 2022-23, a 4.2% increase from the previous year.
Significantly, the government is implementing initiatives to increase the manufacturing sector’s GDP share from 16% to 25%.
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Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
