A PROJECT REPORT ON ENTERPRENEURSHIP MANAGEMENT OF TATA STEEL INDUSTRY

SUBMITTED BY PRASAD A. AMBRE ROLL NO: 2 FOR THE DEGREE OF M.COM (PART I) MANAGEMENT

UNDER THE GUIDANCE OF PROF. FULMALI

M.L.DAHANUKAR COLLEGE OF COMMERCE, DIXIT ROAD, VILE PARLE, EAST, MUMBAI 57 ACADEMIC YEAR 2013-14

DECLARATION

I, MR. PRASAD AMBRE STUYDING IN M.L.DAHANUKAR COLLEGE OF COMMERCE STUDENT OF M.COM PART- I (SEMISTER 1ST). HERE BY DECLARE THAT I HAVE COMPLETED PROJECT ON ENTERPRENEURSHIP MANAGEMENT OF TATA STEEL FOR THE ACADEMIC YEAR 2013-14, AS PER THE REQUIREMNETS OF THE UNIVERSITY OF MUMBAI AS A PART OF MASTER OF COMMERCE- 1 (M.COM) PROGRAMME. THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.

DATE:

PLACE:

(PRASAD AMBRE)

ACKNOWLEDGEMENT

This satisfaction that accomplishes the successful completion of any work is when we say thank you to the people who made it possible, whose constant encouragement and guidance has been a source of inspiration throughtout the Completion of project.

Firstly I extend my thanks to the various people who have shared their opinion and experiences through which I received the required information which is Crucial for my project.

Finally, I express my thanks to Professor FULMALI who gave me this opportunity to learn the subject and guided me with valuable suggestions

A project on

Entrepreneurship management of Tata iron & steel co.

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INDEX
Sr no. 1 2 3. 4 5. 6 7. 8. 9. 10. 11. Particulars introduction history Major happenings Various policies of Tata steels Modernization programme Future projects National steel policy Swot analysis Business plan Product life cycle Bibliography

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INTRODUCTION:
Contribution in the development of Indias economic growth: The Indian steel industry is more than 100 years old now. The first steel ingot was rolled on16th February 1912 - a momentous day in the history of industrial India. Steel is crucial to t he development of any modern economy and is considered to be the backbone of the human civilization. The level of per capita consumption of steel is treated as one of the important indicators of socioeconomic development and living standard of the people in any country. It is a product of a large and technologically complex industry having strong forward and backward linkages in terms of material flow and income generation. All major industrial economies are characterized by the existence of a strong steel industry and the growth of many of these economies has been largely shaped by the strength of their steel industries in their initial stages of development India is the 7 the Largest steel producer in the world, employing over 1/2 million people directly with a cumulative capital investment of around Rs.1 lakh crore. It is a core sector essential for economic and social development of the country and crucial for its defense. The Indian iron and steel industry contributes about Rs.8,000 crore to the national exchequer in the form o f e x c i s e a n d c u s t o m d u t i e s , a p a r t f r o m e a r n i n g f o r e i g n e x c h a n g e o f a p p r o x i m a t e l y R s . 3,000 crore through exports. Consumption of finished steel grew by 5.9 % and increased to24.9 million tones. steel consumption is likely to increase at a rapid pace in future due to large investments planned in infrastructure development, increase urbanization and growth in key steel sectors i.e. automobile, construction and capital goods. The Indian steel industry has emerged as one of the core sectors in the Indian economy with a very significant impact on economic growth. India with its abundant availability of high-grade iron ore, the requisite technical base and cheap skilled labour is thus well placed for t h e d e v e l o p m e n t o f s t e e l i n d u s t r y a n d t o p r o v i d e a s t r o n g m a n u f a c t u r i n g b a s e f o r t h e metallurgical industries. The deregulated Indian steel industry is performing at its peak level in almost all spheres. The total production of finished steel from April 2004 to March 2005 has been estimated to be about 383.25 lakh tones as against the production of 369.57 lakh tones during the same p e r i o d l a s t y e a r s h o w i n g a n i n c r e a s e o f 3 . 7 % . T h e m o s t s p e c t a c u l a r a c h i e v e m e n t h a s , however, been recorded in export performance. Steel has so far proved to be the single key factor responsible for industrial production and t h e r e b y , f o r e c o n o m i c g r o w t h . A n d i t i s g r o w i n g f r o m s t r e n g t h t o s t r e n g t h w i t h n e w e r developments-

Both within steel making practice as well as engineering developments, which ask for more usage of steel. So much so, that economic d e v e l o p m e n t h a s b e c o m e almost synonymous with steel

Major Happening:
Political:
In the 1920s and 1930s, when it was still called Tata Iron and Steel C o m p a n y , T I S C O ' s largely tribal workers fought pitched battles with the European or Parsi management. Work conditions and the right to organize were important rallying issues, and over the years, the company developed a reputation for union-busting, often by violent means. The value of Dorabjis Expansion Programmed came to be appreciated only during the phase when world was reeling under the pressure of the Great Depression. The Tatas survived the depression and supplied nearly of the countrys steel requirements. By th e Second World War, Tatas production capacities had expanded enough to make their p r i c e s l o w e r t h a n those of steel produced in England raising them to an authoritarian position. B y t h e 1 9 8 0 s , t h e g o v e r n m e n t w a s c l e a r l y i n c o n t r o l o f w h a t h a d come to be called the commanding heights of economy. More than 45% o f o u t p u t i n o r g a n i z e d i n d u s t r y c a m e from the public sector as well as bank and other long-lending institution. In 1981-82, eight of the largest firms in India were in the public sector, as were 24 out of the top 30 in terms of total capital employee. In this sense it could be said that Nehrus goals when he had began the planning process had been achieved. But this success has to be seen i n t h e c o n t e x t o f the fact that industrial growth rates had lagge d at about 4% per a n n u m between 1964-65 and 1975-76.This rate was in sharp contrast to what was happening in theA s i a n e c o n o m i e s a n d i n S o u t h e a s t A s i a . T h e s e c o u n t r i e s h a d a c h i e v e d c o n s i s t e n t h i g h growth by opening up their markets and by abandoning policies of import substitution.I n d i r a G a n d h i i n h e r s e c o n d s t i n t a s p r i m e m i n i s t e r w a s n o t w i l l i n g t o i n a u g u r a t e a n e w industrial policy that departed from the socialist pattern put in place by her father. Yet she was far too astute not to recognize the signs of crises that were waiting in the wings. She m a d e t h e gesture that her government supports the expansion and modernization o f t h e private sector. The basic elements of the new policy began to emerge against the background of the India Special Drawing Rights billion -dollar loan agreement with the International Monetary Fund to cope with the balance of payment deficits. Tata Iron & Steel Company R a j i v G a n d h i - B o t h i n t e r n a l & e x t e r n a l f i n a n c e s h o r t a g e s w e r e w o r s e n i n g . T r a d e d e f i c i t increased from 10 billion in 198384 to Rs. 34 billion in 1985-86 so it became difficult to repay loan.

Economic:
TATA Steel, formerly Tata Iron and Steel Company Ltd (Tisco), the company around which the entire township of Jamshedpur was built, was registered in Bombay (now Mumbai) on August 26, 1907. It had an initial capacity of 160,000 tones of pig iron, 100,000 tones of i n g o t s t e e l , 7 0 , 0 0 0 t o n e s o f r a i l s , b e a m s a n d s h a p e s a n d 2 0 , 0 0 0 t o n e s o f b a r s , h o o p s a n d roids. It also had a powerhouse, auxiliary facilities and a laboratory. It was in 1955 that Tata S t e e l b e g a n i t s two million-tone expansion programmed, the largest project in the p r i v a t e sector at that time. The project was completed in December 1958. Beginning in the 1980s, the company undertook in various phases an ambitious modernization programmed. The first phase, between 1981 and 1985, involved a total project cost of Rs.223 crores. This phase, among other things, saw the installation of two 130 tone LD converters, two 250 tone a day oxygen plants, a bar forging machine, two vertical twin -shaft lime kilns and a tar-dolo brick plant. Significantly, a six-strand billet caster and a 130 -tone vacuum arc refining unit were installed, that too in the integrated steel plant. The second phase (1985-1992), involving a project cost of Rs.780 crores, saw for the first t i m e i n I n d i a c o a l injection in blast furnaces and coke oven battery with 54 ovens using stamp-charging technology. Apart from this, a 0.3 mtpa (million tone per annum) wire rod mill, a 2.5 mtpa sinter plant, a bedding and blending plant and a waste recycling plant of 1mtpa were installed. (2) The cost of the third phase (1992-1996) of the project was a whopping Rs.3,600 crores, and that of the fourth phase (1996-2000) Rs.1,300 crores. The company recently commissioned its 1.2 mt (million tone) capacity Cold Rolling Mill Complex at a project cost of Rs.1,600crores. This four -phase modernization programmed has enabled Tata Steel to be equipped with the most modern steelmaking facilities in the world. As of today, the Tata Steel facility has a hot metal capacity of 3.8 mtpa and a crude steel capacity of 3.5 mtpa, corresponding toa s a l a b l e s t e e l c a p a c i t y o f 3 . 4 m t p a . T a t a S t e e l h a s b e e n i n t h e f o r e f r o n t o f I n d i a s industrialization and an engine of growth. It is part of Tata Group, a prestigious, family -owned Indian multinational with 2005 revenues of $17.8 billion, the equivalent of about 2.8% of India's GDP. Tata Steel's acquisition of Corus was a marriage made in heaven. Tata acquired Corus, which is 4 times larger than its size and the largest steel producer in U . K . T h e deal, which creates the worlds fifth largest steelmaker, is Indias l a r g e s t e v e r foreign takeover and follow Mittal steels $31 billion acquisition of rival Arcelor in sameyear.Tata acquires corus on the
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of April 2007 for a price of $12 billion. The price per share was 608 pence, which is 33.6% higher the first offer which was 455 pence.For the fiscal year ended March 2006, the company generated revenues of $3,693.6million (IR17,144.22 Crores), an increase of 0.1% over the previous fiscal year. The company saw an e t i n c o m e o f $ 7 5 5 . 4 m i l l i o n ( I R 3 , 5 0 6 . 3 8 C r o r e s ) , a n i n c r e a s e o f 8 % o v e r f i s c a l 2 0 0 5 months

Social:
Social responsiveness became integral to organizational objectives of Tata Steel, even beforethe company was established in 1907. In 1970, however, Tata Steel formally incorporated itscommitment to the stakeholder concerns, including those of the nation, and environment, inits Articles of Association. The Company shall have among its objectives the promotionand growth of the national economy through increased productivity, effective utilization of m a t e r i a l s a n d m a n p o w e r r e s o u r c e s a n d c o n t i n u e d a p p l i c a t i o n o f m o d e r n s c i e n t i f i c a n d managerial techniques in keeping with the national aspirations, and the Company shall bemindful of its social and moral responsibilities to the consumers, employees, shareholders ,society and the local community. For Jamsetji Tata, the progress of enterprise, welfare of people a n d t h e h e a l t h o f t h e enterprise were inextricably linked. Wealth and the generation of wealth have never "been ends in themselves, but a means to an end, for the increased prosperity of India.Tata Steels efforts at environment management are well recognized. Its Steel Works in J a m s h e d p u r , a l l i t s m i n e s , c o l l i e r i e s a n d m a n u f a c t u r i n g d i v i s i o n s i n i t s o u t l o c a t i o n s a r e certified to ISO-14001. Jamshedpur is the only town in the country which has an ISO14001c e r t i f i e d s e r v i c e p r o v i d e r . S i g n i f i c a n t a c h i e v e m e n t s b y t h e C o m p a n y i n c l u d e a n improvement in environment and r e s o u r c e c o n s e r v a t i o n , i n c l u d i n g a r e d u c t i o n i n g r e e n house erosion, raw materials and water consumption . The Company has increased waste reuse and recycling.T h e h e r i t a g e o f r e t u r n i n g t o s o c i e t y w h a t t h e y e a r n e v o k e s t r u s t a m o n g c o n s u m e r s , employees, shareholders and the community. This heritage will be continuously enriched byformalizing the high standards of behaviour expected from employees and companies.The TATA name is a unique asset representing Leadership with Trust. Leveraging this assetto enhance group synergy and become globally competitive is the route to sustained growtha n d l o n g t e r m s u c c e s s . V a l u e s T r u s t e e s h i p I n t e g r i t y R e s p e c t f o r I n d i v i d u a l C r e d i b i l i t y Excellence.

 Various Policies of Tata Steel:

Quality Policy Safety Occupational Health and Environmental Policy Human Resource Policy Social Accountability Policy Corporate Social Responsibility Policy Drug & Alcohol Policy HIV+ & AIDS Control Policy Energy Policy

Towards organization: Tata was the 1st c o m p a n y t o a m e n d i t s a r t i c l e s o f a s s o c i a t i o n including the clause of social welfare. Towards shareholders: Equal participation, straight forward business policy. Towards employees: P i o n e e r o f P . F . s c h e m e , f r e e m e d i c a l a n d w o r k m e n s c o r p o r a t i o n fund. Towards Society: India should not be a economic super power but a happy country. Towards government: Suggestions of economic reforms and high tax Payer Company.

Towards consumers:
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Consumer is the king of market. Quality products & services timely solutions of problems T a t a S t e e l i s a s i g n a t o r y t o t h e U n i t e d N a t i o n s G l o b a l C o m p a c t , a n d a b i d e s b y i t s 9 principles that address issues on Human Rights, Labor Rights and Environment, etc Tata Iron & Steel Company Plantation of 1 lakh trees in and around Mumbai in collaboration with the NationalSociety of the Friends of the Trees Special project with M/s NEERI, in order to assess the carrying capacity o f t h e region and to ensure sustainable development in the region Technology: (5) Tata Steel has been fortunate to have leaders and a rich reservoir of committed people whocould see clearly through the fu ture and transformed the plant into a modern technologicalgiant with the power of their meticulous envisioning, strategy and planning, through several m o d e r n i z a t i o n p r o g r a m m e s h a v i n g s p e n t m o r e t h a n R s . 7 0 0 0 0 m i l l i o n s o n e n v i r o n m e n t - friendly technologies since 1980. Installation of a modern Cold Rolling Mill Complex, builtat global speed and cost, is not only the epitome of Tata Steels modernization programme, but also remains a global benchmark in project management of its kind. It is also worthwhilet o m e n t i o n t h a t t h e C o m p a n y l o s t d e a r l y f o r t h e i r d e c i s i o n o n t h e i n s t a l l a t i o n o f E O F (Energy Optimizing Furnace) at Jamshedpur Works, and CRM (Cold Rolling M i l l ) a t Gopalpur in Orrisa.T h e T a t a s m a d e a g r e a t c o n t r i b u t i o n i n m a n p o w e r d e v e l o p m e n t f i e l d t o o . F r o m t h e v e r y beginning the Tatas invested substantial time, money and resources in training schemes. In 1 9 2 1 , t h e Jamshedpur Technical Institute was set up with a purpose to replace f o r e i g n technical experts with their Indian counterparts. Furnished with super sophisticated labs,advanced training aids and other infrastructural facilities, the Technical Training Institutes inJ a m s h e d p u r i s t o d a y o n e o f t h e b e s t i n t h e c o u n t r y . R e c e n t l y , a n e w M a n a g e m e n t Development Centre has been built at Dimna to impart advanced management training tomiddle and senior level managers in the Company.

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 Modernization Programme 8

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Tata Iron & Steel CompanyInstallation of a modern Cold Rolling Mill Complex, built at global speed and cost, is not o n l y t h e h i g h l i g h t o f T a t a S t e e l s m o d e r n i z a t i o n p r o g r a m m e , b u t a l s o r e m a i n s a g l o b a l benchmark in project management of its kind. Besides, the Company has also completely r e v a m p e d i t s information technology infrastructure to suit its modernized plant. It spentc l o s e t o R s . 4 0 c r o r e s o n S A P i m p l e m e n t a t i o n a l o n e . T a t a S t e e l s m o d e r n i z a t i o n programmers are detailed in the section, Technology at its Best of the chapter, Imperativesof Change Management.

Natural disaster: Disaster Management & Relief

Tata Steel has a long history of providing relief during n a t u r a l c a l a m i t i e s . S o c i a l consciousness runs deep down to the last e m p l o y e e o f t h e C o m p a n y . E v e r y e m p l o y e e contributes to such causes, complemented by an equal, or more, amount from the Company.B e s i d e s , e m p l o y e e s a l s o v o l u n t e e r t o a d m i n i s t e r r e l i e f o p e r a t i o n s a n d p r o v i d e d i s a s t e r management services to other agencies involved.

Relief Operations
Tata Steels relief and rehabilitation programme, largely e x e c u t e d b y t h e T a t a R e l i e f committee, is carefully planned and time-tested to counter unforeseen devastation caused byfloods, drought and other natural calamities, serving both immediate and long -term needs of those affected, by offering them food, medical aid, rehabilitation, etc. It has even designedand constructed buildings that can withstand natural calamities such as earthquakes. CompanyI n d i a i s a d e v e l o p i n g c o u n t r y a n d i t s e c o n o m y i s g r o w i n g v e r y f a s t . I n s t e a d o f t h i s economical growth there is need for infrastructure to sustain this growt h. The Governmentenvisions India becoming a developed nation by 2020 with a per capita GDP of $154010. F o r a n a t i o n t h a t is economically strong, free of the problems of underdevelopment and plays a meaningful role in the world as befits a nation of over one b i l l i o n p e o p l e , t h e groundwork would have to begin right now. The Indian steel industry will be required and iswilling to play a critical role in achieving this target.I f t h e s t e e l industry gears up in about 3 to 4 years, Indian steel can be both in I n d i a n a n d foreign markets. Steel industry has seen a sunrise after a bad and cloudy night. Worries of financial institutions are over and have taken an exposure in this sector. Indian government h a s p l a n n e d f o r p u m p i n g i n a l o t
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o f m o n e y i n i n f r a s t r u c t u r e i n c o m i n g y e a r s , h e n c e s t e e l consumption will go up manifold. GDP per capita to increase from USD 2500 and USD 5000 in 2020. Population growth rate of 1.3 - 1.5% Continuously improving macro economic factors A strong demographic profile : with a large consumer base Growing urbanization Stable social and political environment

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 FUTURE PROJECTS
Indian Steel production likely to triple in next 15 years National Steel Policy Projections

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Global crude steel consumption is projected to increase to a p p r o x i m a t e l y 1,730 mtpa by 2020, driven by developing countries, including China. (Chart3) While China is becoming the new source of demand, the d e v e l o p e d economies as a whole still remain the largest portion of the worlds steel consumption.(Chart-3) Positive demand fundamentals in development economics. (Chart-3)

Roads and power: The existing road network needs to be expanded and strengthened considerably for reducingt r a n s a c t i o n c o s t s o f t h e I n d i a n s t e e l p r o d u c e r s . T h e s t e e l p l a n t s a n d m i n e s n e e d t o b e integrated with the on -going programmes of national highway development and also with the proposed rural road schemes for expanding the delivery chain of steel across the country,especially the rural areas. The additional requirement of power for the steel industry would be 7000 MW by 2019-2020, requiring an additional investment of Rs 24500 crore. In order to achieve the goal of 110 million tones of steel production by 2019 -20, the NSPs e e k s t o r e m o v e t h e s u p p l y - s i d e c o n s t r a i n t s t o t h e g r o w t h o f t h i s i n d u s t r y i n a n o p e n , globally integrated and competitive environment. The country would need an investment inthe range of Rs.1 lakh to 1.2 lakh crore in creation of additional steel capacities by 2011 -12.Related areas like minin g and power will require an additional investment of Rs. 25,000 to3 0 , 0 0 0 c r o r e . F u r t h e r , t h e r e i s a n e e d t o r e t a i n f l e x i b i l i t i e s i n t h e f i n a n c i a l s y s t e m t o encourage innovation. There are many a r e a s o f t e c h n o l o g y d e v e l o p m e n t a n d a d o p t i o n , which can be risky but also highly rewarding. Venture capitalism needs to be promoted at agreater pace for early adoption of emerging technologies.

PEST Analysis of Steel Sector:

Political Factors : On 19 th Nov. 2008, 5% import duty slapped on steel to save the domestic market. In Oct., thegovernment also removed a 15% export duty on long steel products use by the constructionof two sectors road and power.Present government commitment that
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to make India an economic super power for that they inspire globalization and brass industries to improve GDP growth rate 8% to 10%.Ministry of Steel had no scheme to i mplement directly till 10th Plan (2002 -07). In the 11thPlan (2007- 12) a new scheme named Scheme for promotion of Research & Developmentin Iron and Steel sector has been included with a budgetary provision of Rs. 118.00 crorefor promotion of research & development in the domestic iron and steel sector. The schemeis presently at formulation stage.

Tata Iron & Steel CompanyChanging

in government policy increase competition which benefits to the consumers.Before BJP government as ruler in 1999, there were no benefits got by steel industry. After 1999 when BJP came the industrial people would have got the benefits from EXIM as taxrelief.W h e n N a r e n d r a M o d i b e c a m e t h e C h i e f M i n i s t e r t h e s t e e l i n d u s t r y h a s s t a r t e d g r o w i n g rapidly and the profit increased by Rs 9 to Rs. 13 per Kg.The existing regime of liberalization, decontrol and deregulation of industry in the countryh a s o p e n e d u p n e w o p p o r t u n i t i e s f o r t h e e x p a n s i o n o f t h e steel industry. With a view toaccelerating the growth of the steel sector and attaining the vision of India becoming adeveloped economy by 2020, the Ministry of Steel formulated a

National Steel Policy(NSP)

in 2005. The following are the salient features of the NSP:-(1) The NSP set out a broad roadmap for the Indian Steel Industry in its journey towards reform, restructuring and globalization.( 2 ) T h e l o n g - t e r m g o a l o f t h e N S P i s t h a t I n d i a s h o u l d h a v e a m o d e r n a n d e f f i c i e n t s t e e l industry of world standards, catering to diversified steel demand. The focus of the policy is to achieve global competitiveness not only in terms of cost, quality and product-mix but alsoin terms of global benchmarks of efficiency and productivity.Government has a scheme for routing the allocation of steel material from main producers like SAIL, RINL, and TATA STEEL to SSI units, and other government departments (up to30% of the total allocation) through the small scale industries corporation, SSICs and also through National Steel Industry Corporation NSIC where SSICs are either defunct or not ine x i s t e n c e . I n o r d e r t o e n s u r e t h a t s m a l l s c a l e i n d u s t r i e s o b t a i n t h e s e r a w m a t e r i a l s a s reasonable prices, the government provided nominal handling charges of approximately Rs.5 0 0 p e r t o n e t o t h e corporation so that the corporation supply the steel material as t h e doorstep of the SSI units.P o l i t i c a l c o m p u l s i o n s w e r e t h e o n l y r e a s o n f o r s t e e l c o m p a n i e s t o c u t p r i c e s . O t h e r w i s e , steel prices have been looking up
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quite some time now and there has been good demand of s t e e l i n d o m e s t i c a s well as international markets. Instead of prices going up, they a r e declining. The government had recently effected a 5% customs duty cut on non-alloy steel.

Steel prices to go up as Railways increases iron ore freight rates In a move that may increase input cost for steel cos like Tata Steel, Essar, Jindal and IspatIndustries, Indian Railways has decided to increase the freight rate of iron ore by around5%. The decision would push up freight rates by about Rs 100-200 per tone depending onthe distance. The decision was taken to soothe the inflationary pressure. The price of the orecomprises between 30% to 45% (depending on the kind of iron and steel) of the total priceof steel. Currently, the price of steel is a round $750-900 per tone in the global market. Thegovernment has been fighting inflation due to rise in prices of various raw materials, iron ore being one of them. The Railways transported 53.59 million tone of iron ore for exports in2007 -08 Implementation of the National Steel Policy (NSP), 2005: Tata Iron & Steel Company Freight equalization Scheme was withdrawn in January, 1992. However, with the coming up o f n e w s t e e l p l a n t s i n d i f f e r e n t p a r t s o f t h e c o u n t r y , i r o n a n d s t e e l p r o d u c t s a r e f r e e l y available in the domestic market. Recent years have witnessed unprecedented turmoil in the global steel market. The crisis int h e i n t e r n a t i o n a l s t e e l m a r k e t m i g h t b e a t t r i b u t e d t o t h e m i s b a l a n c e between capacity, d e m a n d a n d p r o d u c t i o n a n d c o n s e q u e n t d r o p i n p r i c e s . Throughout the world there is ana p p a r e n t o v e r c a p a c i t y ( e s t i m a t e d t o b e b e t w e e n 1 0 0 M t 1 5 0 M t ) i n t h e s t e e l s e c t o r . According to the IISI, the companies have been selling their products below costs to survive in global competition. Since 2001, while growth has been negative in most mature markets, Asia has maintained steady growth rate. The Asian production growth has mainly been driven by the surge in steel demand and production in China. The huge Chinese appetite for steel has led the 10.2%surge in output. The growth in Chinese steel demand, generated mainly by demand from infrastructure sector is a beacon for Indian steel since both the nations are comparable on many counts. (C) The Indian steel manufacturers are faced with some major problems and concerns, which w o r k a s i n h i b i t i n g f a c t o r s t o t h e i r e f f o r t t o w a r d s g a i n i n g t h e c o m p e t i t i v e e d g e . A f e w o f these are:
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Unremunerative Prices: Stagnating demand, domestic oversupply and falling prices in thelast few years have hit Indian steel makers. Barring the sporadic rise in demand in the recentmonths, it has suffered from unremunerative prices to the extent that companies have beenfinding it difficult to maintain capital costs.

Stagnating Demand for Steel: According to Mc-Kinsey and Co the domestic steel industryis set to witness a 33% over capacity in the hot rolled coil sector by the year 2003 when thedomestic capacity currently at 45%, in long products and semis is expected to drop at 22% by that year. The non-flat products are also likely to face an over capacity of over 21.4%.

Lower Consumption: Steel consumption in India over a period of time has exhibited astrategy correlation to GDP growth (correlation coefficient of 0.9855 between 1960-1961and 1996-1997) and gross domestic capital formation (0.981).The correlation with GDCF has been 1.0 for the period FY 1994 to 1999. As investmentsdeclined from 1996 -1997 onwards, steel consumption also decreased. Failure to DevelopTrade Especially International Trade . T h e c o u n t r i e s w h i c h h a v e a c h i e v e d m a j o r g r o w t h including growth in steel industry, like Japan, China and South Korea have largely used their trading houses to develop their markets abroad. In India, they have singularly failed to do so.As a result, Indian steel industry does not have a major presence even in the neighboring countries.The reasons for the same include lack of profit motive, wrong scale of assets, little or no coordination between plants and markets, inappropriate logistics/locations, over-manning, poor investment decisions, lack of innovation and inadequate investment in requisite areas.

Slow Industry Growth: T h e l i n k a g e b e t w e e n t h e e c o n o m i c g r o w t h o f a c o u n t r y a n d t h e growth of its steel industry is strong. The Indian steel industry is no exception. The growtho f t h e d o m e s t i c s t e e l i n d u s t r y b e t w e e n 1 9 7 0 a n d 1 9 9 0 w a s similar to the growth of theeconomy, which as a whole was sluggish. T h i s s l u g g i s h g r o w t h i n t h e s t e e l i n d u s t r y h a s resulted in enhanced rivalry among existing firms. As the industry is not growing the only o t h e r w a y t o g r o w is by increasing one.s market share. Consequently, the Indian
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steelindustry has witnessed spurts of price wars and heavy trade d i s c o u n t s , w h i c h h a s d o n e Indian steel industry no good. Social Factors: Corporate Social Responsibility (CSR) has been to develop the villages a s m o d e l s t e e l villages. All profitable steel PSUs have made commitments to the cause of CSR and havee a r m a r k e d a t l e a s t 2 % o f t h e i r d i s t r i b u t a b l e s u r p l u s for CSR activities. The total budget allocated for CSR in respect of the P S U s f o r 2 0 0 7 - 0 8 i s a r o u n d R s . 2 3 0 . 0 0 c r o r e . C S R activities focusing on environmental care, education, health care, cultural efflorescence and peripheral development, family welfare, social initiatives and other measures are underway in the PSUs. In view of the calamity brought in by the floods in UP, Bihar and Assam, some of the PSUs organized immediate relief measures in these affected states . SAIL, NMDC Ltd. and RINL contributed Rs.5 crore, Rs.4 crore and Rs.2 crore respectively towards the flood relief measures. All the main producers have been urged by the Ministry to adopt villages a r o u n d t h e i r p l a n t a n d a s p a r t o f t h e i r C S R a c t i v i t y a n d h e l p . U s e o f s t e e l h a s b e e n emphasized in items such as storage beans, bullock carts, buildings such as school buildings, p a n c h a y a t h a l l s , health centre buildings, water tanks, waiting sheds etc. 129 villages a r e being developed into model steel villages. Child labour is the issues of small scale sector of the steel industry. Children were exploited by paying them low wages. A decision was taken to have at least one dealer in each district in order to make availabl esteel items to common man. In order to ensure the availability of commonly used items of steel in the rural areas across the country, SAIL and RINL are expa nding their distribution networks at a fast pace with the objective of having dealers in all the districts of the country. P r e f e r e n c e f o r S C , S T a n d O B C ent and occupation.A s i d e i t s l o n g h i s t o r y , T a t a S t e e l h a s w r i t t e n t h e b o o k o n w e l f a r e m e a s u r e s i n I n d i a n Industry many of which, have been subsequently followed by others i

Safety Measures
For improvement in the overall safety situation in the Iron & Steel industries in Indiafollowing remedial measures need to be taken up: Tightening the legal system so that any instance of violation of s a f e t y p o l i c y , whether by public sector or private sector, does not go unpenalised. The system of f a c t o r y i n s p e c t o r a t e , s a f e t y o f f i c e r s a n d l e g a l f r a m e w o r k h a s t o b e r e f u r b i s h e d accordingly. There should be up-gradation in legal provisions to take care of changes intechnologies / work environment so that loopholes are plugged as far as possible.
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OHS Management system as per ILO guidelines and OHSAS 18001 should b e adopted in all plants. In India, many outdated technologies viz., twin hearth furnace, ingot making etc. arestill being practiced in some steel plants. These processes are hazardous to personnelworking there and it is required to phase these out immediately to improve safety in such plants. Apart from this, new technological development will also facilitate attainment of safe work environment. Fire modeling and hazard risk analysis should be done in all pla n t s f o r b e t t e r assessment of inherent risk/ hazard:

Social Audit (2002-03) The Social Audit being reported, for the period 1991 2001, was c o n d u c t e d d u r i n g t h e period 2002- 03 within the framework of the same Terms of Reference as that of the 2ndSocial Audit. The Audit Panel comprised of the following members recommended by th eBoard: Ms. Pheroza Godrej Justice S. K. Mohanty The late Justice D. N. Mehta (Retd.) (Chaired the Panel until June 2003, when he suddenly Passed away) Ms. Tarjani Vakil, MD, EXIM Bank (opted out during the initial phase of the Audit)The Company nominated Mr. Ajit Jha, Resident Representative, New Delhi, Tata Steel, asthe Secretary and Chief, Co -ordination, 3rd Social Audit, to provide management support tothe Audit Panel, and later in the evaluation process, his role mandated to be independent of intra-company domain. Subsequently, Mr. S. K. Suman, Head, Co-ordination, Tata Steel,was nominated by the management to provide research and report assistance to the 6 Tata Iron & Steel CompanyPanel. Mr. Jha and Mr. Suman assiduously checked the facts and figures contained in thisreport 7

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SWOT ANALYSIS
Earlier known as Tata Iron & Steel Companyupto 2005 Strengths of TATA STEEL: 1. Mineral Reserves Tata Steel has two collieries i n West Bokaro and Jharia, inthe state of Jharkhand. The iron ore units are located in Noamundi, Joda andKatamandi in the states of Jharkhand and Orissa. Tata Steel Limited also has amanganese mines and dolomite quarries in Orissa. These mines are located at anapproximate distance of 150 kms from Jamshedpur, home to the steel company'smanufacturing facility. The Steel Company's iron ore units produce 9 million tons perannum of various grades of high quality iron ore including rich blue dust ore. Thecompany in India is having mines of 281 million tones reserves in its mines inJharkhand and thus having minerals to cater its needs for more than 20 years. Thecompany has also been acquiring stake overseas in Canada, Mozambique, Australiaetc. to boast its reserves for clean coking coal which is rarely available in India. 2. Management Team - Tata Steel has a highly credible management team who hasdisplayed their skills in expanding the company through inorganic route. Thecompany has successfully acquired Nat Steel of Indonesia, Millennium Steel of Thailand and more importantly Corus. The companys virtuosos of finance have beenable to find innovative ways to tackle the companys bulgeoning debt and keep thebottom line in the green zone despite lowering demand and huge debts accumulated. 3. Information Technology - The entire mining operation of the Company is safeguarded against accident occurrence. Proactive measures are undertaken to ensurethe employee's health and productivity through ergonomically designed work stationsand by protecting them from occupational hazards. All its mines are ISO-14001 -Environmental Management System Certified. Tata Steel's collieries use 'Surpac', astate-of-the-art mine planning software that estimates the volume of coal in everyseam. This software is coupled with qualitative detailing that focuses on outputconsistency. To maximize productivity and utilization, a voice and data equippedGlobal Positioning System is used, which helps to supervise mining activity formachine movement and engine status. 4. Innovativeness of TATA Steel with respect to its competitors - TataSteel has the lowest operating cost for steel manufacture in the world

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Further it has displayed effective means in adopting an eco-friendly andsustainable approach towards the manufacture of steel thus proactivemeasures are undertaken to ensure the employee's health and productivity throughergonomically designed work stations and by protecting them from occupationalhazards. 5. Adaptability of the company in the fast change of the environment - Tata Steel has displayed immense agility in the recent past during the globalfinancial tsunami. Its virtuosos of various fields have adopted variousmethods like lowering of production and even shutting down of steel plantsowing to the lack of demand, managing the balance sheet efficiently etc. Thecompany has 70% of its procurement of raw materials for its operations inAsia through long term contracts and so its margins can be shielded from thenuances of the volatility of the financial markets.6. Brand value - The TATA brand owing to its highly ethical and a socialisticapproach to business have made its name synonymous to trust. After theacquisition of Corus another powerful brand, the brand value of the companyhas enhanced further.7. Corporate governance - Tata Steel has had an impeccable record forcorporate governance. It has set the benchmark in global corporategovernance principles of transparency, accountability and equity for others tofollow. Tata Steel has been consistently receiving prestigious awards at boththe national and the international arena. Recently it bagged the BestGoverned Company Award for corporate practices presented by Asian Centrefor Corporate Governance.8. Excellent integration with Corus Corus has a great reserve of around2000 metallurgists and technology which could be exploited by Tata Steel onseveral fronts.9. Excellent procurement philosophy - Tata Steel has around 70% of itssupplies through long term contracts. Thus it can be shielded from thevolatility of the financial markets.10. Spawning upon opportunities - Tata Steel has been amongst the earliestto spot the escalation in the demand for steel in the forthcoming years. It hashence invested heavily in the expansion of its existing facility at Jamshedpurand is setting up other green field projects at Orissa, Jharkhand etc Weaknesses of TATA Steel1. Huge debt burden - Tata Steel is having a total debt of 10.2 billion USD inits books. It has a debt equity ratio 0f 1.6 which means that the assets of thecompany is largely financed through debt. With the inflation on a rise thecentral banks of most all the countries are intending to tighten in the liquidityin the money markets. As a result of which the interest rates are on a rise. InIndia the banks are mulling the option of a rate hike and most analysts feelthat the RBI is going to increase the repo rate by almost 100 bps further aftera CRR hike of 75 bps in late February this year. Thus it
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would add to theinterest burden of the company which would further increase the liabilities of the company and thus degrade the quality of its balance sheet further.2. High attrition rate - Tata Steel has traditionally faced the brunt of highattrition rate. In its Jamshedpur plant many engineers constantly change their jobs to SAIL in Bokaro and vice-versa. Thus the formation of a core team of capable individuals across all departments is very difficult as the size of theteam is ever changing.3. Products in the portfolio lacking demandThe company has certainproducts in its portfolio like aerospace steel which lacked demand in therecent past. Primarily due to the slow down of the aviation sector which led todelay in the delivery of aircrafts as a result of cutting of capacity by airlines. The company also had certain Cast products largely marketing in the UK which has been witnessing slowdown in demand since 2001. Hence thecompany had to close down its Tee Side plant.4. Degradation in brand value owing to job lossesTATA group has madeits name synonymous to job security of it employees. But the shutdown of itsplants in the UK and The Netherlands will dent its image to a certain extent.As a result of which around 1600 employees would lose their daily livelihood.5. Low cost recovery There are specific products like the aerospace steeland cast products which has received feeble response in the past. Thecompany has failed to recover costs in this business front.6. Laggard in technological front - Companies like SAIL has efficientlyintroduced the XRF (X-Ray Fluorescence) in its plants at Durgapur and Bokaroover 12 months back which the Tata Steel has failed to do.7. Bad raw material procurement philosophy of its subsidiariesThelargest subsidiary of Tata Steel, Corus has high exposure to spot prices and a higher operational gearing among the larger European steel companies. Hence it has the risk of volatilityassociated with pricing, one of the key elements in determining profitability of a commodity Opportunities . Competitive position of the companyTata Steel is the second largestproducer of steel in India and the sixth largest producer in the world.2. Newer technologies i) The Corex process combines an iron melter/coal gasifier vessel witha pre-reduction shaft to produce a liquid product that is very similar toblast furnace hot metal. Coal, oxygen, and pre-reduced iron are fedinto the melter/gasifier to melt the iron and produce a highly reducingoff-gas.ii) The HIsmelt process Iron reduction and coal gasification take placein a liquid metal bath. The fundamental processes of HIsmelt beganwith early experiments in Germany with bottom-blown oxygensteelmaking
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converters (LD, LD-AC, KMS, among others) to allow forcoal, lime, and/or iron ore injection through the bottom nozzles.iii) Direct Iron Ore Smelting (DIOS) process in Japan and the AISI directsteelmaking process in North America produced two similar routes tohot metal production. Both processes utilize a smelting reactor wherethe primary reactions occur in a deep slag bath as opposed to in themetal phase.3. Opportunities in the fieldIndia has geared up for rapid expansion in thefield of infrastructure. The Government of India (GoI) has earmarked Rs.1, 70,000 crore forinfrastructural spending for the fiscal year 20102011 and the trend is set toescalate up to the fiscal year 2025 when India is slated to become the thirdlargest economy in the world. Further many private players eitherindependently or by undergoing public private partnerships (PPP) has alsocome into the fray. The consumption of steel has been steadily increasingwith the rapid investment in the infrastructure and real estate projects. Theannual steel production of India has touched 200MT and according togovernments steel policy is expected to touch around 250 MT by 2013-2014. The demand for Indian made steel is escalating overseas out of the 200 MT of steel currently produced in India around 50% of it is exported. In the first sixmonths of the fiscal year 2009-2010 the Indian steel export almost doubledto 9.3MT from 4.4MT in the same period the previous fiscal year. Thecountrys iron ore exports during April-October 2009 period grew 20 per centover the year ago period to 53 million tons.4. Acquisition opportunities In the aftermath of the financial tsunamivarious mineral assets are available globally at a price which is just a shadeof their prime valuations. The government of various countries has beenputting up coal blocks under the hammer. Tata Steel has been very active in the asset acquisition space and has bagged various coal blocks in Asia, Africaetc. which is essential for its security of raw materials.5. Opportunities for demand of higher prices - The demand for steel is on arise both domestically and internationally as a result of the enhanced focus uponinfrastructural development. Secondly with other steel projects of internationalgiants POSCO, ARCELOR MITTAL stalled due to land acquisition problems the pricesof steel are slated to soar. In the month of April 2010 the steel prices wereincreased by Rs.2500/ton and this is just the brink of the U-Shaped economicrecovery and the prices are slated to rise further in the near future.6. The movement of Tata Steel in the value chain frontIndia is the onlycountry in the world where steel can be made cheaper and there is consumption. Then there are other countries like Ukraine, Iran, Brazil, Australia and Bangladeshwhere steel can be made cheap because of the availability of iron ore and coal. TataSteel has been to Iran, Ukraine, Bangladesh - all in the last year and is looking atChina for finishing capabilities Ukraine is like India, where the factors of productionare competitive. The sustainable level of demand in Ukraine is 12 million tons (MT),but one can make much more steel because of the availability of ore. Secondly, thelabor is cheap in India and so is the cost of energy
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. Hence, Tata Steel's strategy isbased on breaking up this value chain and putting each part where it's the mostcost-effective. So primary steel will be produced in India, where there are largedeposits of iron ore. But the Asian markets, now a key focus for Tata Steel, will bebetter addressed by taking the semi-finished steel to these countries for finishingand then selling there. For now, Jamshedpur will provide the semi-finished steel forthe NatSteel bases. Tomorrow, it could well come from Iran or Ukraine; thesecountries have abundant iron ore and are therefore ideal for primary steel making. 7. Improvement in the quality of operations, products, i n v e n t o r y management 7.1 Strategic Sourcing Approach Tata Steels approach is based on the principle that strategic procurement isan exercise beyond cost reduction. Commodities used for steel-makingprocesses and their allied services are being selected and prioritized forstudy using strategic sourcing tools, before their annual procurement,depending upon their annual purchase value and criticality of application.After the selection of the commodities, a Commodity Competence Team(CCT) is formed which is a crossfunctional team wherein people fromdifferent departments such as User/Operation, Research and Development,Quality Control, MRO, Supply Management and Finance come together toformulate sourcing strategies for a commodity purely on a techno-commercial basis. After the formation of the CCT, the commodity studies arecarried out based on different technical and commercial parameters as Strategic Sourcing Levers Strategic sourcing requires the application and interpretation of sophisticatedstrategic sourcing tools and techniques. Tata Steel follows a variety of sourcing strategies, as shown in Figure 5, with multifarious objectives whichare mentioned below: Decrease specific consumption and specific cost of commodities on life-cycle costing basis. Source consistent quality products. Ensure continuous supply of materials. To increase the productivity of blast furnaces or steelMelting shops bydecreasing the down time through the use of improved quality, costeffectivematerials, wherever applicable 3 Total Refractory Management Concept To ensure the quality of refractory, proper service and the life of cast houserunners which are directly related to the hot metal production and also todecrease the total cost of ownership on a life-cycle costing basis, a strategicdecision was taken to go for total refractory management. In the totalrefractory management of cast house troughs for high-capacity blastfurnaces, the supplier is responsible for the supply of the entire refractorymaterial for all the locations of cast house troughs, initial installation, regularsupervision, maintenance of troughs through casting till guaranteedthroughput hot metal is achieved and the supply of all kinds of equipmentsrequired for installation and maintenance of cast houses. 7.3.1 Vendor Selection through comparative assessment A comparative analysis of the suppliers was carried out based on parameters,which includes total throughput commitment of hot metal, throughput of hotmetal committed in between two repairs, total down time of trough runners,a reference list of a suppliers customers, quality of refractory to be used andlife-cycle cost of refractory in terms of Rs/ ton of hot metal (Rs/thm). 7.3.2 Reduction of Life-cycle cost
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7.3 Total Refractory Management Concept To ensure the quality of refractory, proper service and the life of cast houserunners which are directly related to the hot metal production and also todecrease the total cost of ownership on a life-cycle costing basis, a strategicdecision was taken to go for total refractory management. In the totalrefractory management of cast house troughs for high-capacity blastfurnaces, the supplier is responsible for the supply of the entire refractorymaterial for all the locations of cast house troughs, initial installation, regularsupervision, maintenance of troughs through casting till guaranteedthroughput hot metal is achieved and the supply of all kinds of equipmentsrequired for installation and maintenance of cast houses. 7.3.1 Vendor Selection through comparative assessment A comparative analysis of the suppliers was carried out based on parameters,which includes total throughput commitment of hot metal, throughput of hotmetal committed in between two repairs, total down time of trough runners,a reference list of a suppliers customers, quality of refractory to be used andlife-cycle cost of refractory in terms of Rs/ ton of hot metal (Rs/thm

A reduction of the total life-cycle cost. Of refractory, in terms of Rs/thm, hasbeen done by proper selection of material, optimization of its amount toachieve the guaranteed throughput and finally by knowledge-basednegotiation. 7.3.3 Benefit to Tata Steel Reduced down time of the trough runners leading to higher rate of production. Reduced specific consumption of refractory in terms of kg/thm. Reduced overall cost of ownership due to higher campaign life of refractories and also due to higher rate of production, as the productivity of the blast furnace largely depends on the quality of refractories used at thecast house. Different Sourcing Levers Applied for Procurement of High Value and CriticalCommodities 8. Time for diversificationWith the demand for various products of steelsoaring presents us with the right time for upstream diversification. Threats faced by Tata Steel1. Resources to cushion the from business environmental changeTata Steel is a company floated by Tata Sons whose assets are valued at

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around 108 billion USD and thus the company has enough reserves tocushion itself from market fluctuations. 2. International competitionCompanies like the Indian Steel magnateLakshmi Mittals Arcelor Mittal, Posco has landed in the shores of India andhave proposed to set up 8 MT and 12 MT respectively. These are amongstthe largest steel producers in the world and have a high chance of eatinginto the market share of Tata Steel. Indian market is also plagued withcheaper Chinese made steel

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which is ubiquitously available and issignificantly munching through the pie of all Indian steel makers including Tata Steel. 3.FinancialCrisesTata Steel is having a huge debt of 10.2 billion USD inits books and hence a huge interest burden. With the volatility of thefinancial markets and the tightening of the liquidity by the central banksthis rate is slated to go up and hence would further increase the interestburden of the company. 4. Adoptability of the company to technological changes Tata Steelhas shown immense integration abilities in the past. With the acquisitionof it has been able to imbibe the high end technological knowledge to itsproduction facilities and hence has been able to produce high quality steelat least prices and significantly bettered its operating margins. 5.RegulatorynormsThe government of India has chalked a strict normfor the clearance of a plant through environmental impact assessment(EIA). To get clearance from the concerned authority demands more thaneight months thus leads to delay and project cost escalation. Albeit thegovernments steel policy has been pro industry in order to increase thesteel capacity at a brisk pace. 6. Adverse effects of land acquisition picketingIndia is plagued withviolent agitation against land acquisition. The land acquisition process of the companys plant in Orissa has been stalled primarily due to theuprising of the land losers in the concerned area. Albeit the company isproviding with attractive compensation packages, the uprising is primarilydue to the cheap politics of the local leaders to come into the limelight. This will severely dent the companys expansion plans of the future. 7.DecrementinthesalesvolumesSome of the Tata Steel products(likeaerospace steel) have witnessed a severe reduction in sales and as aresult of which the production facilities of the company in the UK and TheNetherlands is facing the brunt of shut down. 8.BrandequityoftheproductsTata Steel brand is a very powerful one,can only take a product very far. Beyond that it will be necessary for theroduct to strike ahead with its own brand. He says, "A villager who goesto buy steel in the marketplace does not know what Tata Steel is bringingto this steel. All he knows is that it is a Tata product." That villager needsto be told about the superiority of Tata Steels product over others. This isthe work of the brand. Branding has begun to yield rich dividends. Lastyear Tata Steel sold about 345,000 tons of branded steel, whichrepresented about 12 per cent of its total steel sales, as against 265,000tons, representing 9 per cent of total steel sales, the previous year. Thisyear the company plans to more than double its volume of branded steel.Although the resultant increase in turnover of branded products will beenormous, there are miles to go before Tata Steel can rest on its laurels.

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BUSINESS PLAN
Tata Steel Consulting provides business planning services to a range of industrial sectors, including:

Iron and steel - all long and flat products Tube and pipe Foundry and forge products Rail products Iron ore mining Engineering steels Wire products Metal fabrication industries Steel distribution and service centres Ferro alloys The business planning group operates independently or in tandem with other groups within Tata Steel Consulting and sometimes in collaboration with external organisations such as management consultants and investment banks. As a result it can always call upon an exceptional range of skills and experience to meet the diverse requirements of its clients.
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Clients The business planning group has assisted a broad range of clients, in public and private sectors, situated in a large number of countries.

Expertise Assignments undertaken are diverse in terms of the problems and issues addressed. Tata Steel Consulting has provided strategic assistance to numerous manufacturing companies.

Methodologies A wide range of expertise and methodologies is employed by the business planning consultancy group. The first stage of assignments often requires detailed analysis of market prospects for the client company. This can involve extensive interview programmes in the metals consuming sectors as well as economic and demand forecasts.

New Delhi: The world's seventh largest steel maker Tata Steel Ltd, a part of India's diversified business conglomerate Tata Sons Ltd, plans to sell its stake in various group companies, including Tata Motors Ltd, to raise fund for expansion and repay high cost loans, the Business Standard reported citing unidentified bankers. The steel major may garner as much as Rs 72 billion via selling its stake in group companies, the bankers told the paper. Presently, Tata Steel owns 5.6% equity stake, worth Rs 50.14 billion, in Tata Motors. Besides, it also holds 51% stake in Tata Sponge; 73.4% in Tinplate India; 54.5% in Tayo Rolls; 32.5% in TRF Ltd; 0.7% in Tata Power and 50% in Dhamra Ports.

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The steel making company may sell these stakes to the holding company Tata Sons Ltd to raise funds, which will be utilized for expansion in the Odisha state and repay higher cost loans, bankers told the daily. Early this year, Tata Steel was holding discussion with Adani Group to divest its holding in the Dhamra port project (Odisha), media reports said, adding that the company is now awaiting the Odisha government's approval to raise capacity so that it gets a better valuation for the lossmaking port company. Tata Steel plans to spend around Rs 420 billion in its Odisha plant in two phases. Total expenditure for the phase I has risen up to Rs 240 billion from the earlier estimated Rs 190 billion on account of currency fluctuation and other cost overrun Tata Steel Europe has won an order to manufacture 60,000 tonnes of high-quality rail for a new high-speed line linking the two holy cities of Makkah and Madinah in Saudi Arabia. The new railway will allow millions of pilgrims to cross the 444km between the two cities at speeds of 320kmh. The line will cross desert, withstanding temperatures ranging from freezing to 50C, as well as sand storms, flash flooding and shifting dunes, a statement said. Grard Glas, rail sector head for Tata Steel, said: "This is a prestigious project which will see the holy cities being linked by rail for the first time. "Tata Steel is delighted to be contributing to this high-speed line, which will have to overcome some major challenges presented by building a high-capacity rail line across some of the most extreme terrain in the world." Steel for the project will be made at Tata Steel's Scunthorpe plant in the UK before being rolled into rail in lengths of 25 metres both there and at the company's plant in Hayange, Northern France, he said. Work on producing the rail will start at the end of this year and is expected to continue throughout 2014. Tata Steel rail has already been used successfully in similarly challenging conditions for projects in Brazil and Mauritania, the statement added.

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Last year the Saudi Railways Organisation awarded the contract for the finalphase of completing, running and maintaining the Haramain High-Speed Rail Project to a group of Spanish infrastructure, construction and technology companies. The new line is expected to carry around 160,000 people a day - and even more during the Hajj pilgrimage. They will be transported on a fleet of 35 new high-speed trains. The project started in 2009, with an estimated cost of more than 12bn. The new rail line is set to open to the public in late 2014 or early 2015. Besides the two holy cities, the line will have three other stops, two in Jeddah for commuters and one in Saudi Arabia's new King Abdullah Economic City, a residential, industrial and commercial macro-complex that is still being built. Spanish construction companies Copasa, Imathia and OHL are responsible for building the line's superstructure and the track bases, as well as for the line's mechanisms.

PRODUCT LIFE CYCLE

Life Cycle Assessment

In recent years concern for the environment has grown among national governments, industry and the general public. In consequence, there is pressure to improve manufacturing systems and change consumer behaviour to progress towards sustainable development. Life Cycle Assessment (LCA) has emerged as a leading tool for quantitative analysis of environmental impacts of products and processes, which are often very complex. LCA measures the impact on the environment over the course of a products lifetime, from the parts and materials that are used in its man ufacture through to its assembly, shipment, use, and ultimate disposal.

Major drivers for the increased use of LCA include:

Assessing and Improving Environmental Performance LCA provides a holistic understanding of environmental performance; the impact on the environment can be reduced not just in certain process stages, but from the viewpoint of the products total lifetime.
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Legislation Governments are increasingly requiring LCAs to be carried out to demonstrate compliance with existing legislation. Marketing and Eco-Labels LCA results can be used to promote products based on environmental criteria. Environmental Product Declarations are eco-labels based on LCA results and are an increasingly popular way of differentiating products from competitors by emphasising environmental performance. Improvements to Process and Product Design LCA provides a strategic tool for the identification of process and product design improvements. Tata Steel has Life Cycle Inventory (LCI) data for steel industry products. This includes materials and energy balances, as well as an evaluation of emissions to air, water and land in the supply chain industries (i.e. mining, transport, power, chemicals etc). The LCI was compiled in accordance with ISO 14041 guidelines on conducting LCAs.

Tata Steel can provide the following LCA Services:

LCA Studies (to ISO 14041 Standard) Defining the scope and the boundaries of the project, developing a software model of the system being studied, compiling the LCI, conducting the Life Cycle Impact Assessment (LCIA) studies, analysing sensitivity to assumptions and data quality and interpretation of results. Critical Reviews of LCAs Internally generated LCAs should be reviewed critically by external parties to ensure compliance with ISO 14041 standard. Advice on Existing LCA Studies / Methodologies Tata Steel can comment on the results or methodology used in external LCA studies. Related Activities Tata Steel can assist with the Life Cycle Costing or Whole Life Costing of products. Tata Steel can provide service and support to Works, commercial and technical functions, customers and designers who use steel products and those who wish to evaluate using steel in their products and services.

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BIBLIOGRAPHY : Websites: (1)http://steel.nic.in/Perfomance%20budget%20(200506)Englishchap2.pdf (2)http://www.ieIndia.orgpdf8989MM104.pdf (3)http://article.wn.com(4) http://steel.nic.in/(5)http://www.tatasteel.com(6)http://greenbussinesscentre.com/images/ph otos/Exp48.pdf (7)http://www.tatasteel.com/newsroom/awards.asp(8)http://www.ieIndia.org pdf8989MM104.pdf (9)http://www.tatasteel.cominvestorrelations2002pdfsmda.pdf (10)http:// steel.nic.in/Performance%20Budget%20(200506)Englishchap2.PDF(11)http://www.tatasteel.cominvestorrelationsan200708investorpresentation-feb08.pdf (12)http://www.slideshare.net/pankajhambarde/tata-corus-pptpresentation(13http://www.tata.com/company/Articles/inside.aspx?artid=KfibEhYKXcE T

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