Engineering exporters in the micro, small and medium enterprises segment have sought Prime Minister Narendra Modi's intervention on rising steel prices, stating that the industry needs the alloy and other inputs at affordable rates so that export competitiveness of value-added products is maintained in the global markets.
S C Ralhan President of Ludhiana Hand Tools Association, in a letter to the prime minister, said that many of the competing countries, particularly China, provide support to manufacturing units by providing steel and other inputs at many reasonable prices to boost the competitiveness of their engineering sector in the global markets.
He said that India is gradually losing out its markets to China in the value-added segment of exports and the recent growth visible in exports is largely on account of a hike in the prices of metal and commodities.
A sharp decline is seen in the export trends of finished engineering goods, he said.
"In the given situation, the micro, small and medium enterprises industry needs to be provided steel at reasonable prices so that export competitiveness of value-added products is maintained," Ralhan said in his letter.
He cautioned that if the prices would not come under control, a large number of manufacturers would be out of business and that could result in the closure of factories, loss of employment.
He suggested the government consider setting up a raw material bank for micro, small and medium enterprises to provide steel and other key inputs to them by extending some kind of subsidy.
"An immediate decision is needed particularly as a continuance of pandemic in the country has already resulted in the closure of a large number of MSMEs which will further increase, if immediate steps are not taken to provide steel to them at a most competitive price," he added.