How India Emerged As World's Second Largest Producer of Crude Steel

The journey of India's steel industry is a story of hardwork, commitment and innovation. Today, the country is the second largest producer of crude steel in the world -- only behind China. India surpassed Japan, pushing it to the third position in 2018, in crude steel production while other major producers like the US and South Korea are way behind it.

The overall steel production in the country has increased to a historic level of 120 million tonne per annum (MTPA) in 2022-23, which is the more than double of its 2013-14 figure of less than 60 MTPA. Now, it has set an ambitious target of taking its steel production to 300 MTPA by 2030.

Moreover, in a major turnaround, India has transformed from a net importer to net exporter in steel sector. It witnessed an export of 6.72 MTPA of finished steel as against the import of 6.02 MTPA in 2022-23 whereas the country was a net importer of steel with 9.32 MTPA imports vis-a-vis the export of 5.59 MTPA in 2014-15.

In the last decade, steel PSUs like SAIL, NMDC, MOIL, KIOCL, MSTC and MECON used more than Rs 90,000 crore of their own resources for capex and paid a dividend to the government to the tune of Rs 21,204.18 crore. But this position hasn't come that easy. The government has taken a slew of measures to help the industry grow over the years by leaps and bounds.

Steel Scrap Recycling Policy

The government has come up with this policy to promote scientific processing and recycling of ferrous scrap. Six 'vehicle scrapping centres' have been opened in various cities for the purpose and three more will begin their operations soon. The end-of-life vehicles (ELVs) will be used as raw material for the production of steel. The State governments as well as private sector are being on-boarded in this regard.

National Steel Policy

The government came up with this policy in 2017 with a focus on developing a technologically advanced and globally competitive steel industry that promotes economic growth. Apart from setting a high target of achieving 300 MTPA of steel production by 2030, the policy also envisaged to enhance the operational capacity of crude steel production of SAIL from existing 19.51 MTPA to around 35.65 MTPA.

The policy gives preference to domestically-manufactured iron and steel products (DMI & SP) in government procurement which has so far resulted in import substitution to the tune of Rs 34,800 crore approximately.

PLI Scheme

The government also came up with a productivity-linked incentive (PLI) scheme which proved to be a quite successful one for domestic production of specialty steel. So far, 57 MoUs involving 27 companies have been signed under the scheme. This will attract a committed investment of around Rs 30,000 crore with a downstream capacity addition of 24.7 MTPA and an employment generation potential of 55,000.

Similarly, 'Brand India' labeling is an important exercise to differentiate Indian quality steel from the others. The Union Ministry of Steel has undertaken the initiative of Made-in-India branding of steel produced in the country and major steel producers have already come together in this direction.

The Ministry has also on-boarded itself on the PM Gati Shakti National Master Plan Portal. It has identified 22 critical infrastructure gaps and is pursuing it with the Union Ministries of Road Transport & Highways, Railways, Ports, Shipping & Waterways.

In order to promote decarbonisation in steel sector, the Steel Ministry has already constituted 13 task forces for identifying the action points for each aspect of green steel production and is in continuous talks with stakeholders from the steel industry and other ministries / departments such as Environment, Forests & Climate Change, Railways, Power, etc.