The latest forecast from the International Monetary Fund puts growth in India at under 2% for 2020-21. Such a rate is unacceptable for a large country with high aspirations, especially with the government hoping for a US$ 5 trillion economy by 2025.
Many metropolitan cities remain under some form of lockdown. Demand continues to be challenging: for example, the month of April witnessed zero new car sales for the first time ever. Most consumers of steel, durables and vehicles have cut spending during the lockdown. Domestic mills are facing cash-flow issues. Ferrous scrap demand will be subdued for the rest of this year before greater normality is expected to return in the first or second quarter of 2021.
However, there are a few bright spots: the larger Indian steel mills will continue to focus on exports of finished products and/or semis to China and other Asian markets; and two-wheeler auto sales picked up strongly at the end of June and into July.
Nathani Group of Companies (IND), Vice-President of the BIR Ferrous Division