New steel policy eyes 600 MT capacity, 500 MT consumption: Steel secretary

The government also plans a ₹5,000 crore Viksit Bharat Ispat scheme for small producers, with incentives linked to output and lower carbon emissions

The government will put its draft National Steel Policy in the public domain for stakeholder consultation in about a week, Steel Secretary Sandeep Poundrik said on Tuesday.

 

The policy will target more than 600 million tonnes (MT) of steelmaking capacity and over 500 MT of consumption by 2047. About 45 MT of this is expected to be accounted for by exports, either directly or through steel embedded in manufactured products.

 

“These are conservative numbers,” Poundrik said at an event organised by the Confederation of Indian Industry (CII) here.

 

It will also propose a ₹5,000-crore scheme for small steel producers to incentivise production linked to reduction in carbon emissions. And, the Carbon Credit Trading Scheme (CCTS) for larger steel producers is expected to be notified “very soon,” Poundrik said on the sidelines of the event.

  

“In about a week, we will put this policy into the public domain for consultation and comments from stakeholders,” he said. He added it could be released as early as Monday next week.

 

The proposed policy will provide a roadmap for the steel sector up to 2047 and replace the National Steel Policy, 2017, which has a horizon of up to 2030.

 

Poundrik said the new policy takes into account issues that were not as prominent when the 2017 policy was formulated, including artificial intelligence (AI), machine learning (ML), technology upgradation, decarbonisation and sustainability.

 

India’s crude steel capacity stood at 220 MT in FY25, which is projected to touch 294 MT by FY31, according to Poundrik.

 

The government also plans to increase speciality steel production, particularly grades used in automobiles, defence and aerospace. Poundrik said 175 speciality-steel projects involving investments of ₹55,000 crore are currently underway.

 

The policy will also include measures to discourage cheap and substandard steel imports to make the Indian steel industry, including small steel players, competitive, he added.

 

For small steel producers, the government is proposing the ₹5,000-crore Viksit Bharat: Initiative for Secondary Steel Progress for Atmanirbhar Bharat (ISPAT) scheme, under which incentives would be linked to production and reduction in carbon emissions.

 

“We are proposing the scheme, which will only target small steel producers, where they will be given incentives linked to their production. It would be dependent on the reduction of carbon emissions,” Poundrik said.

 

He said emission reductions could be achieved through better technology, better raw materials and greater use of renewable energy.

 

The scheme is likely to be approved by the competent authority in the near future, he said.

 

Assuaging concerns over supply-side glut, Poundrik said India's steel consumption has grown faster than capacity over the past four calendar years between 2022 and 2025, with consumption growing at 11 per cent compared with capacity growth of more than 9 per cent.

 

The projected expansion of steel capacity by 2047 will also increase pressure on raw materials. India will require more than 700 MT of iron ore, Poundrik said. “Raw material availability will become a major challenge. We will have to work on that,” he said.

 

He also said India remained dependent on foreign countries for critical steelmaking technologies despite having around 120 years of steelmaking history.

 

The government is, therefore, seeking to incentivise development of domestic technologies, he said.

 

Also, the government has notified the constitution of a steel industry safety council following accidents at steel plants in the last few months, Poundrik said.

 

The council will be chaired by the steel secretary and include chairman-cum-managing directors (CMDs) of integrated steel plants and representatives of associations of small steel producers. Its mandate will include ensuring that standard operating procedures are in place and implemented, as well as conducting third-party investigations following accidents.

 

The steel ministry is also studying the impact of the European Union's 1.6 MT steel quota for India before taking up the issue with concerned governments, Poundrik said.

 

He added that some steel grades could not currently be exported in sufficient quantities, while India could export more than the quota in certain other grades.

 

“So we are studying that, and then we will again take it up with the concerned governments,” he added.