Q.13) Account for the present location of irons and steel industries away from the source of raw material, by giving examples.(UPSC CSE 2020)(150 words,10-marks)

Traditionally, the source of raw materials guided the location for establishment of Iron & Steel industries, for example, Bokaro, Durgapur near coalfields, and Bhadravati, Bhilai & Rourkela in the vicinity of iron ore sources.

Raw materials besides iron ore and coking coal, essential for iron and steel industry are limestone, dolomite, manganeseand fire clay. All these raw materials are gross(weight losing), therefore, the best location forthe iron and steel plants is near the source ofraw materials. In India, regions comprising parts of Chhattisgarh, Northern Odisha, Jharkhand and western West Bengal, which is extremely rich in high grade iron ore, good quality coking coal and other supplementing raw materials.

However, with changing needs and transformative developments in availability of raw materials, there have been new drivers of location for Iron & Steel industries.

Factors driving location of irons and steel industries away from the source of raw material:

• Product Market and Transportation: Most of the Iron & Steel demand comes from mega cities like Mumbai, Pune, New Delhi, etc. Keeping in mind the logistics aspect, there is a huge difference between the cost of transportation via road, waterways and railways. Thus, location of industries in hinterland makes the overall supply chain very costly to coastal cities like Mumbai.
• Import of raw material: Countries like Japan, who are deficient in raw materials for Iron & Steel industries generally have steel plants at the coasts to reduce the transportation effort and cost.
• For strategic and developmental policies reasons the iron and steel plants are located away from raw material source regions.

Examples:

• Iron steel industry is developed in coastal areas or port location because they rely on imported coal and iron- E.g. steel industry in Osaka-Kobe region of Japan.
• The Vijayanagar Steel Plant at Hosapete in Karnataka was developed using indigenous technology. It receives coal from Kanha Valley in Madhya Pradesh and Singareni in Andhra Pradesh.
• The Vizag Steel Plant, in Vishakhapatnam in Andhra Pradesh is the first port-based plant which started operating in Iron ore is obtained from Bailadila (M.P.) iron ore deposit. Limestone is derived from Joggapeta, Andhra Pradesh, and coal is obtained from Damodar Valley region. It has the advantage of the export of the finished product.
• The Salem Steel Plant in Tamil Nadu was commissioned in 1982. It was established due to political considerations and regional development rather than supply of raw material.

Conclusion:

Although source of raw materials remained historically a significant factor for location of Iron & Steel industries, with changing times and patterns of production and transport, location of irons and steel industries can also be seen away from the source of raw materials.