IR’s decision to make Stainless Steel LHB Coaches to boost Steel Manufacturing industry

NEW DELHI: The Indian Railways’ recent decision to shift towards German Linke Hofmann Busch (LHB) coaches, made of stainless steel, may come as a boon for the domestic steel industry.

The government is also contemplating use of steel in construction of road overbridges so that consumption of steel rises in the country. In this direction, the ministry of steel on 1 December has called a meeting of the domestic steel industry and related associations to discuss various measures to increase steel demand in the country.

The national carrier’s move comes in the wake of one of the deadliest train accidents—the derailment of the Indore-Patna Express on 20 November which claimed 150 lives.

The domestic industry, which is already supplying stainless steel to the Indian Railways for manufacturing LHB coaches, has welcomed the move.

“The proposed conversion of all coaches to LHB will present an opportunity to all stainless steel suppliers to be a part of the nation-building process and will certainly provide a healthy boost to stainless steel demand in the country. Our company has enough capacity to take care of increased demand resulting from such a move and any further capacity addition will not be required,” said S. Bhattacharya, Director, Jindal Stainless Ltd.

Another industry executive working for a stainless steel manufacturer, who did not want to be named, said shifting from Integral Coach Factory-type to LHB coaches had been in discussions for a long time, but a broad agreement could not reached. As it has been agreed upon, it will help domestic industry in using the capacity in a better way, he added.

“The shift from mild steel to stainless steel will really be a value addition. We have excess capacity to feed the Indian railways for its new set of coaches,” said the executive.

Earlier it was reported that the government is trying to ensure increased purchase of steel by key infrastructure ministries, including railways, shipping and road transport so as to increase domestic steel consumption and provide a fillip to India’s steel demand.

“The railways has a clear-cut mandate that steel should be used in rail overbridges as they last long. The same kind of proposal is there for road overbridges given currently bridges are made by using cement which generally last for 25-30 years. This will be discussed with all stakeholders shortly,” said a senior government official requesting anonymity.

According to provisional data compiled by Joint Plant Committee, India’s steel production during October rose by 14% to 8.25 million tonne (MT). However, steel imports went down 55% to 538,000 tonnes and consumption also fell 1.4% to 7.11 MT.

The government’s intention is that infrastructure growth should come out with the steel usage for government projects, added the official.

Stressing on the need for stainless steel coaches, the Anil Kakodkar-headed safety review committee in 2012 also mandated a complete switch over to LHB production within five years.

Queries emailed to the ministries of steel, railways and road transport on 29 November remained unanswered.

Experts termed it a positive move.

“These steps well definitely boost stainless steel consumption in the country. Also, the government is serious on usage of steel in road bridges, which may further spur steel demand,” said Anjani K. Agrawal, national leader, mining and metals sector, at consultancy firm EY.