Aviation minister admits that execution of the merger process has not been up to the mark
Civil aviation minister Praful Patel has suggested that the merger of Air India and Indian Airlines could have been better executed but for "a kind of sabotage from within.”
Asked about criticism of the merger, he said, "I concede that the merger could have been better executed and implemented. There has been even I would say a kind of sabotage from within. People did not want to see it to be implemented well.”
“But the basic concept has been going on since the time of JRD Tata. A couple of times well-meaning people had attempted to merge the two as it made business, economic and technical sense,” he said.
"There are no two opinions about whether the merger was required or not. This was not a knee-jerk reaction. It was well thought-out, well-planned and made immense economic sense," Mr Patel said, reports PTI.
He said the merger was done after consulting secretaries and committees.
The minister said that the government took a “conscious decision” based on valid technical inputs. “The intentions were good but maybe the execution has not been up to the mark,” he admitted.
Mr Patel said that the government as of now intends to run Air India as a State-owned carrier.
Asked if the government had any intention of privatising or disinvesting Air India, he said, “I cannot speak about policy until some decision is taken by (the) government. As a personal opinion, I can say that most national carriers across the world have not done well.”
"Considering that, Air India has still come a long, long way and has retained its national carrier status,” he said.
"Someday, the government may take a different decision. As of today, we intend to run it as a national carrier, as (a) State-owned (airline)," Mr Patel said.
On the completion of Mumbai airport, Mr Patel said that though the project was 18 months behind the Delhi airport, when it is completed it would match the latter in terms of being “truly world class.”
"Mumbai and Delhi are not going to be different in terms of standards and state-of-the-art terminals. But Mumbai has a peculiar problem of rehabilitation of a large number of people living in the airport vicinity,” Mr Patel said.
He said that 20,000 slum-dwellers would be rehabilitated in “permanent, very good” houses just two kilometres from the airport.
Steelmaker plans to expand manufacturing capacity at its Karnataka unit to 16 million tonnes
Steelmaker JSW Steel plans to expand its manufacturing capacity at its Bellary plant in Karnataka from 10 million tonnes (MT) to 16MT with an investment of $5 billion-$6-billion, a top company official has said, reports PTI.
"We have decided to expand steel manufacturing capacity at our Bellary plant from 10MT to 16MT at an investment of $5 billion-$6-billion (around Rs20,000 crore-Rs25,000 crore) in the next three-years," JSW Steel's vice-chairman and managing director Sajjan Jindal told reporters on the sidelines of an event.
“We are also looking at investing in infrastructure to develop roads, railways and power plants at our Bellary unit,” Mr Jindal said, adding that the company is presently working on the details of these investments.
“We have already invested close to Rs40,000 crore in the Bellary plant and will continue to invest in Karnataka due to the proactive policy of the Karnataka government," he said. “Our investment in Karnataka is the largest compared to other units.”
"The upcoming ports and extensive railway networks will help industries to grow in the State. The new mineral policy by the Karnataka government is also a positive initiative," Mr Jindal said.
Steel prices could go up, he said, as raw material prices have risen substantially. "There is a huge cost-push because raw material prices have gone up substantially," he said.
ArcelorMittal’s CEO forecasts a drastic increase in prices for benchmark hot-rolled coil
Lakshmi Mittal, chief executive officer of ArcelorMittal, the world's biggest steelmaker, has stoked a row over how global prices are set by telling consumers that raw material costs may push steel rates up by 21%.
"The cost of producing steel is going to go up and will be passed on to customers," Mr Mittal said in an interview, reports PTI.
Benchmark European hot-rolled coil prices will rise by $150 a metric tonne in the second quarter, he said. Steelmakers are passing on costs after Vale SA, the largest iron-ore producer, scrapped a four-decade system of annual price-setting and boosted prices for Japanese steelmakers as much as 90%.
Carmakers, the biggest users of steel, are crying foul.
The European Automobile Manufacturers' Association, which represents companies, including Volkswagen AG, PSA Peugeot Citroen and Fiat SpA, said that members want EU regulators to “tackle distortive developments” caused by the changes from mining companies.
“The necessity to increase prices is generating the ire of customers and a bitter battle is raging,” said Christian Georges, an analyst at Olivetree Securities who has tracked industry and resources for 15 years.
Mr Mittal's forecast for benchmark hot-rolled coil would mark a 21% jump from levels now of about $700 a tonne, based on Metal Bulletin data. The coiled steel is used by firms from Toyota Motor Corp, the world’s biggest carmaker, to Royal Philips Electronics NV, the largest lighting company.
Eurofer, a group representing steelmakers in Europe, accused the biggest iron ore suppliers of “illicit coordination of prices” and said it had notified the regulatory arm of the European Commission about possible anti-competitive practices. It said that a shift to shorter contracts for iron ore at higher rates may boost costs for their customers by as much as a third.
“Steel producers will have to pass these rises on to the consumers,” Eurofer director-general Gordon Moffat said in a phone interview. “It's going to create a great deal more volatility in prices.”