A steel plant's turnaround

Print edition : April 08, 2005

The Basic Oxygen Furnace converter at the Durgapur Steel Plant.-

THE Durgapur Steel Plant (DSP), a subsidiary of Steel Authority of India Limited (SAIL), is the nerve centre of the Asansol-Durgapur industrial belt. The company is heading towards a record net profit in the current year, having notched up Rs.475 crores in the first nine months. After decades of running on loss, the steel plant registered a modest profit of Rs.81 crores in 2004.

The plant, the dream of Dr. B.C. Roy, West Bengal's second Chief Minister, was set up in the late 1950s with an initial capacity of one million tonnes of crude steel per annum. The capacity was increased to 1.6 million tonnes in the late 1960s. The plant undertook a massive modernisation programme in the early 1990s. Its technological upgradation was matched with intensive training programmes for its human resource. Today the plant has the rated annual capacity to produce 2.1 million tonnes of hot metal, 1.86 million tonnes of crude steel and 1.6 million tonnes of saleable steel.

The major facilities that exist in the plant include the raw materials handling plant, coke ovens and coal chemicals, the sinter plant, blast furnaces, the steel melting shop, the continuous casting plant, rolling mills, and the wheel and axle plant. The factory has an extensive network of road and rail transport.

The integrated steel plant is one of the largest industrial complexes in West Bengal. It is spread on 6.5 sq km and employs about 16,000 people. The Durgapur Steel Township, spread on around 40 sq km, is well planned, and has all modern facilities for a high standard of living.

The Durgapur Steel Plant is the only major indigenous supplier of wheel sets, loco wheels, carriage and wagon wheels and axles to the Indian Railways. The S-profile wheels it has developed for the Indian Railways are undergoing field trials. These wheels dissipate heat better during braking and can run at high speed.

The company will invest Rs.2,800 crores in the next seven years in another expansion programme in which, among other things, it will increase its crude steel capacity from the present 1.86 million tones per annum to three million tonnes. The investment will help the company route its entire crude steel production through the continuous casting route, reduce the cost of production, and improve the product mix.

Encouraged by its turnaround, the company has chalked out a course of action involving continuous upgradation of its facilities in the coming years. The immediate plan is to shift towards the continuous casting route by installing a bloom caster, which will come along with a ladle furnace and a reheating furnace. Another wire rod mill will provide enrichment to the product mix. This plan, which is part of the SAIL Corporate Plan, has been made with the anticipation that the consumption of steel will increase from the present level of 35 million tonnes per annum to 60 million tonnes by 2012.

S.K. Bhattacharyya, managing director of the steel plant and widely considered the man behind the company's turnaround, said: "We are aiming at products that give us high revenue." He explained that with the additions and modifications in place, by 2012 the steel plant would be able to position itself at the high end of the market as a quality steel producer.

For years the steel plant has been a catalyst of sorts for the socio-economic development of the region. It has contributed in a major way to provide tubewell facilities in the water-scare peripheral areas, and to educate the rural population through the upgradation of and addition to the available educational facilities. It has also assisted in developing roads and other infrastructural facilities.

The Durgapur Steel Plant has also played a major role in encouraging small-scale industries. A total of 196 small-scale industries are registered with the plant, out of which 29 have been accorded ancillary status. According to company sources, in 2005 the steel plant will be spending Rs.55 lakhs in peripheral development schemes for the surrounding villages. The plant proposes to extend help by financing infrastructure projects in the villages, mainly in education, health care, drinking water supply and sanitation.

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