What India’s Modi Government is Doing to Produce 300 Millions Tons of Steel by 2025

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This is part two of a report on India’s new national steel policy.

In response to by C.S. Verma, Chairman of the Confederation of Indian Industry’s National Committee on Steel, who said a lack of raw materials is hurting India’s steel industry, Steel Secretary Rakesh Singh said the government would encourage the use of greenfield steel units for capacity augmentation, and to help procure raw materials, talks were being held with the various provincial governments about creating Special Purpose Vehicles. These, he said, would ensure raw material linkages and clearances for new projects.

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Naveen Jindal, Chairman, Jindal Steel & Power Limited, told the audience that steel was still very expensive for the common man, because India’s per capita consumption as compared to other nations was low. For costs to fall, he added, output had to increase.

Despite such adversities, India’s steel production growth rate has been robust. Just last week, MetalMiner reported that there were early signs of recovery for the sector following a slight growth in July. Our forecast has proven true as figures for August show that Indian steel production has outstripped the world average with a 5.2% jump to 7.02 million tons.

Figures released by the World Steel Association showed global steel production had risen by an average of 1.4% in August to 135 million tons compared to the same month last year.

India’s steel output growth was mainly due to higher production by major producers. The world average remained subdued in August because of relatively lower production by China, the world’s largest producer.

Another recent report in The Times of India said India would become the third largest steel maker with an installed capacity exceeding 110 million tons per annum by next year when the ongoing expansion projects of SAIL and some private steel producers come online.

The author, Sohrab Darabshaw, contributes an Indian perspective on industrial metals markets to MetalMiner.

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