During the year, the world continued on a path to regain economic
 stability as it emerged from the global meltdown of 2008. While the US,
 the UK and Western Europe experienced modest recoveries, China, India
 and other Asian countries, as also certain countries in Latin America,
 continued to register high levels of growth and continued to be centres
 of signif cant economic activity. Inflation has, however, now emerged
 as the new global economic challenge, driven by a substantial rise in
 the prices of almost all commodities, mineral resources and energy,
 impacting almost all industrial sectors.
 
 The global steel industry continued to face an unprecedented increase
 in the price of iron ore and coking coal, accentuated by short-term
 supply disruptions. These have created pressures on the viability of
 the steel industry and consequently the competitiveness of the user
 industries. China continued to be the largest national steel producer
 and largest domestic consumer of steel. The steel demand in Western
 Europe and the UK has remained more or less stagnant, with intense
 competition from steel producers in Eastern Europe utilising lower cost
 inputs. Asian countries, including India, on the other hand, continued
 to enjoy robust demand from several sectors resulting in increased
 volumes and a richer product mix.
 
 TATA STEEL Europe
 
 Tata Steel Europes operations have had to compete in the high-cost
 marketplace where demand has been somewhat stagnant. The Company has
 restructured its operations in several areas in order to be more
 competitive.  During the year it sold the unremunerative steel slab
 business as a going concern to an Asian steel maker. It has initiated
 steps to restructure and rationalise the UK long products manufacturing
 facilities with a view to make them Profitable. The Company is also
 making long-overdue capital investments to upgrade and modernise some
 of the older, less Efficient facilities as well as securing sources of
 coal and iron ore overseas, to achieve partial raw material security in
 the coming years.
 
 India and South East Asia
 
 Tata Steels operations in India and Asia continued to be driven by the
 buoyancy in the markets in India and South East Asia where growth rates
 have continued to be high and demand for consumer products, automobiles
 and construction have been very promising. The expansion project at
 
 Jamshedpur, which will take the Steel Works capacity to 9.7 million
 tonnes, will contribute signif cantly to the volume and product mix of
 Tata Steel when these new facilities come on line in early 2012.
 Construction is also underway on the new 6 million tonnes capacity
 greenf eld project in Kalinganagar, Odisha.
 
 The Company has always given great importance to its control of the
 iron ore and coal which it consumes.  It continues to actively explore
 opportunities for growth in India and other parts of Asia, which the
 Company believes will continue to be an area of economic growth.
 
 BUSINESS OUTLOOK
 
 During the year under review, the Indian economy has performed well
 with very attractive growth rates reffecting strong consumer demand for
 almost all goods and services. The years ahead could, however, be
 challenging as the government endeavors to curb inflationary growth.
 Energy costs, reffecting higher prices of crude oil and gas as well as
 the shortfall in the availability of gas and electrical power will in
 themselves have a devastating impact on the countrys competitiveness
 and its ability to sustain the high growth rates it has enjoyed. Fiscal
 policies to control inflation will af ect access to credit and could
 slow down investment levels as also consumer demand. The most signif
 cant impact will however be from the slowdown in major infrastructure
 projects in the areas of road construction, mass transit systems, power
 generation and investments in primary industries, where financial
 closure, right-of-way permissions and land acquisition could present
 major delays. These would have a major impact on job creation and the
 demand for goods and services, resulting in a substantially lower level
 of economic activity in the country compared to past years.
 
 Further, state and private enterprises have been investing in
 establishing additional capacity to cope with the rising demand for
 goods and services. The anti-inflationary induced slowdown of economic
 growth in India, coupled with the possible plateauing of growth in
 China, the enormous financial burden on the Japanese economy following
 the devastating natural disaster and its after effects, could possibly
 slow down the Asian economic engine which has become such an economic
 game changer over the past decade.
 
 In Europe, the high debt and economic unsustainability of some of the
 southern European countries will most likely impose a signif cant
 strain on the financial structure of the European Union. Also, the
 increased political unrest in some of the countries in the Middle East,
 if escalated, will contribute to the political and economic instability
 in the region, (or the world), in the years ahead.
 
 Good f scal and economic management will therefore be needed to
 stimulate economic growth while at the same time curbing inflationary
 forces. There will need to be measures in place to control speculation
 and exploitation resulting in runaway prices of commodities and mineral
 resources which cascade through the entire value chain.
 
 In the years ahead, steel will continue to be an essential building
 block of national development. Tata Steel will continue to be committed
 to be amongst the most cost- Efficient steel companies in the world,
 which participates in the development of the countries where it is
 present while meeting its social responsibility to its stakeholders and
 the communities which it serves.
 
 Chairman 
 Mumbai, 31st May, 2011