On June 12, 2004, at a meeting of the National Steel Consumers Council in New Delhi, the Union Steel Minister Ram Vilas Paswan said that the Ministry is considering setting up an independent regulator to monitor and fix the prices of steel and the proposal would be taken to the government in three months. The proposed National Steel Price Regulatory Commission would supervise issues relating to the price and distribution of steel and will make sure that the products reach the consumers at the right price and in adequate quantities. This statement by the Minister was not well received by the industry as the steel manufacturers condemned the proposal and dismissed the very idea as ‘ridiculous’ as steel prices are governed by market conditions and demand-supply situation. On June 17, Paswan clarified that the Ministry was not in favor of any controls and setting up of the regulatory authority was the idea of the consumers and his Ministry is only acting on the proposal put forward by them.

Sir Jamshedji Tata set up the Tata Iron & Steel Company Ltd. (TISCO) in the year 1907. This was the first steel company of the country and since then the Indian steel industry has come a long way and now has the status of the eighth largest producer of steel in the world. Steel is one of the core sectors of the economy and is a critical component for the growth of the country. Even in the era of planned economy, the steel industry received full attention of the government and became a key sector for public investment. Until the 1990s the iron and steel sector was by and large preserved and dominated by the public sector with TISCO being the only exception. But the economic reformsinitiated by the government since 1991 added a new facet to the industrial growth in general and steel industry in particular. The Indian iron and steel sector was the first core sector to be deregulated in 1991 and there were many structural changes that took place during that time. The four basic rules on which the control mechanism was founded namely, state regulation on capacity creation, imports and exports, price and distribution for the major producers was dismantled paving the way for a market- centric industry. The steel sector transformed from the seller to a buyer market in the post liberalization period. The industry that was previously controlled and regulated became a free market and hence a competitive sector. The administered prices were replaced by supply and demand determined market prices. The industry structure changed with the entry of private players who along with them brought world-class technologies and capacities. The lowering of tariff rates and lifting of quantitative restrictions were steps towards further liberalization.

In the post liberalization era, the Indian steel industry was booming. However after the 1997 Asian meltdown, the global steel industry experienced a serious and prolonged downturn and the domestic demand also stagnated. But by 2001, there was some respite for the industry and now the industry is making its mark in the global arena.

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