New Delhi, Nov 28 (IANS): Industry body Assocham Friday urged the country's central bank to provide concessions in terms of paying penalties to bank by the steel industry, taking into account the recent volatility caused due to cancellation of coal block allocations by the Supreme Court.

According to Assocham, it has urged the Reserve Bank of India (RBI) to advise all commercial banks to extend credit for payment of penalties due to de-allocation of coal blocks by the Supreme Court.

Assocham said it has further asked the banking industry through RBI to provide payment of upfront bid amounts for participation in the coal block bidding by deserving steel companies.

"The steel industry in India has been passing through a very tough phase for past five years owing to low metal demand and extreme price pressures notably as steel prices dropped by Rs.4,000 per ton during the course of past few months," said D.S. Rawat, Assocham secretary general.

"The problem has aggravated due to coal blocks' cancellation by the apex court thereby creating uncertainty over availability of coal at competitive prices in the future," Rawat said.

The industry chamber also suggested for refinancing of rupee term loan through foreign currency loans and also refinancing of external commercial borrowings (ECBs) through fresh ECBs.

Assocham has also urged for conversion of interest burden up to March 2016 into terms loans without impacting asset classification to improve cash flows.