While the World's No. 8 steelmaker, Tata Steel expects India sales to grow 14 percent in this fiscal year it has also cautioned that the rising raw material costs and the euro zone's debt crisis could hamper the growth of the sector.

Kirby Adams, Tata Steel's head of European operations said that the company expects the steel demand to rise but since the European economy is still very fragile, it is being cautious about the second half of the year.

It may be noted here that the Tata Steel's European operations stands for close to 2/3rd of its total operations while the booming Indian market stands at close to 1/3rd.

The World Steel Association said last month that the demand for steel was growing better than expected mainly backed by high demand from China. Adams also highlighted the fact that the company is currently facing a situation where it is suffering from high input costs which it is in turn trying to recover by the means of higher steel prices.

Tata Steel reported a net loss of 20.1 billion rupees ($425 million) in the financial year ended March that us way down as compared to the Rs. 49.5 billion in profit that it reported a year before.