Kolkata:
The higher transportation charges on inputs of steel companies will
largely neutralise the benefits of lower freight on finished steel
products in the railway budget announced on 27 February.
Higher freight charges on iron ore and coal will put an additional
burden, estimated at Rs 50 crore, on the steel industry. The public
sector steel major Steel Authority of India Ltd (SAIL) will be footing
the charges to the extent of Rs 25 crore. Says SAIL chairman Arvind
Pande: We are happy that the railways minister has reduced the
freight burden but the raw materials for making steel will place
an additional burden of about Rs 25 crore annually on SAIL.
It is also felt that the dismantling of the administered price
mechanism
could open the doors to more competition for railways. With
petroleum prices slated to decline, the steel industry might choose to
use roads rather than rail for transportation purposes.
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