Punjab Manufacturers And MSMEs Seek Revival Of PSIEC Steel Supply Depots

Chandigarh, May 22 (KNN) Steel manufacturers and MSMEs in Punjab have urged the government to restore institutional procurement and distribution mechanisms for raw materials, seeking the resumption of steel supply through depots of the Punjab Small Industries and Export Corporation (PSIEC).
 
Industry bodies said the earlier system enabled small manufacturing units to procure steel directly at competitive rates, helping them remain cost-effective and competitive, reported Times Of India.
 
According to industry representatives, MSMEs are currently dependent on private distributors and large market players who procure steel from public sector companies at lower rates and subsequently sell it at higher prices, increasing input costs for smaller businesses.
 
They argued that the existing arrangement has created market distortions and strengthened the dominance of a few large players, adversely affecting engineering units, fabrication industries, agricultural equipment manufacturers and small workshops across the state.
 
Loss Of Direct Procurement Access Raises Cost Pressures 
 
Under the earlier Joint Plant Committee discount regime, PSIEC and the National Small Industries Corporation (NSIC) procured steel in bulk from public sector steel producers such as Steel Authority of India Limited and extended pricing benefits to MSMEs.
 
However, following deregulation of the steel sector, the distribution mechanism was gradually scaled down nearly a decade ago, resulting in the loss of direct procurement access for small manufacturers.
 
Industrial representatives said MSMEs have since been compelled to rely on secondary supply channels, often at significantly higher costs. The Ludhiana Beopar Mandal has written to Narendra Modi seeking intervention in the matter.
 
Its president, Maninder Pal Singh, said MSMEs have become increasingly dependent on private supply networks. “Earlier, PSIEC depots ensured access to steel at fair and transparent rates. After the system ended, small units were left at the mercy of private players,” he said.
 
Singh further alleged that supply concentration among a handful of large entities has led to cartel-like conditions, making it difficult for smaller manufacturers to compete effectively.
 
Industry Calls For Government Intervention And Pricing Oversight 
 
Industry stakeholders have also called for stricter government oversight of steel pricing by public sector companies and the revival of PSIEC-based distribution channels.
 
They warned that restricted access to affordable steel is affecting production costs, employment generation and the overall competitiveness of Punjab’s MSME sector.
 
Noting that many PSIEC storage facilities are currently underutilised, Narinder Bhamra, President, Fasteners Manufacturers Association of India  said the earlier procurement and distribution model was more viable for small industries, while dependence on private pricing mechanisms is placing additional pressure on manufacturers.
 
Industry bodies have urged both the Centre and the Punjab government to take steps to ensure equitable access to steel for MSMEs and small-scale manufacturers.
 
(KNN Bureau)