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`Busy' steel cos yet to forge alliance

Ambarish Mukherjee

NEW DELHI, Aug. 3

THERE has been no major headway in the formation of the proposed Indian Steel Alliance (ISA) on the lines of The Steel Alliance of the US and Canada after it was announced around the beginning of this year.

According to highly-placed industry sources, none of the companies in the proposed alliance was ready at the moment to work out a detailed action plan. As a matter of fact, though more than six months have passed, the share of the participating companies have not been firmed up yet.

``All the proposed participant steel companies are currently undergoing major restructuring and, as a result, the alliance has taken the backseat,'' the sources said.

Five steel companies will participate in this proposed alliance, namely Steel Authority of India (SAIL), Tata Steel, Jindal Vijaynagar Steel, Ispat Industries and Essar Steel.

The purpose of the alliance is to conduct surveys on various uses of steel besides the current ones and promote it as an item of choice. One of the major thrust areas, which came up during preliminary discussions, was to chalk out ways to promote steel c onsumption in the household sector.

But the industry being in the doldrums, everyone is currently tightlipped about the progress in the formation of the alliance. The sources told Business Line that ``It is basically a problem of managing time. The top brass in all the five companies are b usy sorting out their problems at the international level. There is heavy pressure from the financial institutions and the companies are finding it difficult to service their huge debt obligations. Only after they sort out their own problems and are read y to devote time, will there be any progress in the alliance front.''

As a matter of fact, the Government is hoping that the alliance would be able to play a crucial role in boosting domestic demand for steel and function as an important forum to fight trade disputes.