SEATTLE (Scrap Monster): The steel demand growth in India is likely to hit the slowest pace in three years, said a recent report published by the ratings agency ICRA Ltd. However, steel consumption in the country is likely to outpace global growth.

According to ICRA, steel consumption in the country is likely to expand by less than 6% during this fiscal year. This is the slowest pace of demand growth after the 3.1% increase recoded during the fiscal year ended March 2017.

Jayanta Roy, senior vice president at ICRA noted that it had earlier maintained the view that demand is most likely to grow between 6% and 7%. However, under current circumstances, a growth of 7% would be out of line. Even a 6% growth would be optimistic in today’s environment, he said.

Fresh capital expenditure on construction and infrastructure by the government is vital for steel consumption growth in the country, said Roy. The industry is looking forward to some big announcements from the government to re-ignite the slowing down economy, which could in turn boost steel demand, he added.

The Indian steel consumption had expanded by 7.5% and 7.9% respectively in the previous two fiscal years.