Government sets up monitoring committee to regulate steel prices

12 Jan 2007

Mumbai: The government has set up a committee comprising members of both public and private sector steel producers to monitor steel prices on a continuous basis and to check artificial hike in prices.

"We have set up a joint public-private steel price monitoring committee (SPMC) to monitor price movements of various steel products so that small consumers could get steel at reasonable prices," steel minister Ram Vilas Paswan said.

The committee, to be headed by joint secretary in the steel ministry, would formulate a pricing strategy for the future and recommend plans with regard to steel production, consumption and trading.

While the government aims to keep steel prices in check, the minister emphasised that this was not to regulate steel prices. The committee will interface between producers and consumers to stabilise the prices.

The government is particularly worried that even if PSU steel companies reduce prices the consumers do not get benefit as the private sector accounts for two-thirds of the supply.

"PSUs control one-third of steel supply and they come under pressure always to reduce prices, while the private players cannot be checked."

"We have now included private players in the committee so that a collective decision on prices could be taken and all have agreed to keep the steel prices stable," Paswan said.

While it is not the first time that the government is monitoring steel prices, it now assumes significance in the wake of rising inflation.