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Distress call from Bengal foundries

The industry in Bengal is a large employer, providing livelihood to close to 1 lakh people
Representational image.
Representational image.
File photo.

Our Special Correspondent   |   Calcutta   |   Published 08.04.22, 04:50 AM

Foundry units in Bengal have approached the state and the Centre for help to deal with the spiralling costs of raw materials and a dip in demand because of the high price of the finished products.

Some of the 800 units, mostly located in Howrah, are now idle as they are unable to sell the finished products at high prices. Some of the smaller units are unable to arrange for working capital to run their operations because of the high cost of pig iron and ferro alloys —two critical raw materials for the foundries.

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“We are pleading with the Centre to arrange procurement of pig iron at a cheaper rate as it is helping the steel units in the MSME sector to procure raw materials at a discount,” Dinesh K. Seksaria, chairman of the Indian Foundry Association, said.

The foundry industry in Bengal is a large employer, providing livelihood to close to 1 lakh people.

Apart from supplying to the domestic industry, the industry exports to a large extent. Pig iron prices have jumped nearly 50 per cent from January, while ferro alloy prices have gone up by 20 per cent in line with global trend.

The IFA has written to the Union mine and steel ministries to put a temporary ban on exports of iron ore and pig iron or impose duty to discourage their export.

The foundry industry is also pleading with the Bengal government to reduce the cost of electricity.

Power constitutes about 20 per cent of the operating cost of foundries who usually make cast iron products.

While Damodar Valley Corporation is providing electricity at Rs 4 per unit, state utility and CESC are giving power at double the cost. The Association is also seeking the state nod to harness solar power and sell excess volume to the grid.

Recently, the Centre instructed large steel companies to offer discounts in hot rolled, cold rolled and rebar prices to secondary producers who are mostly small and medium industries. “We were hoping a similar discount of Rs 3000 a tonne will be given to pig iron but it did not happen,” Seksaria added.



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