India’s Steel Production Growth Outpaces China: Report

Mumbai — India’s steel sector is rapidly progressing toward the government’s ambitious goal of achieving 300 million tonnes per annum (MTPA) of crude steel production capacity by FY2030-31, according to a private sector report released on Thursday.

The report highlights that India’s steel production growth rate has surpassed both China and the global average. From 2016 to 2024, India recorded a Compound Annual Growth Rate (CAGR) of approximately 5 per cent, compared to 2.76 per cent for China and 1.77 per cent globally.

Significantly, while China’s steel output has been on the decline since 2020, India’s growth accelerated during the same period, achieving a robust 8 per cent CAGR. This trend underscores India’s growing influence in the global steel market, fueled by abundant raw material reserves, competitive labour costs, and supportive government policies, the report stated.

As of FY2024-25, India has installed 205 MTPA of steel production capacity, with major industry players proposing an additional 167 MTPA expansion by 2031. However, the sector faces notable challenges, including the need for greater iron ore beneficiation, an 85 per cent reliance on imported coking coal, limited availability of steel scrap, and high carbon emissions from steelmaking processes, according to the report by MP Financial Advisory Services LLP (MPFASL).

India’s per capita steel consumption currently stands at 93.4 kg, significantly below the global average of approximately 219 kg. This gap is expected to narrow as the country ramps up investments in infrastructure, affordable housing, and manufacturing sectors, driving demand for steel. Achieving the 300 MTPA crude steel target will be crucial to meeting this growing consumption, the report emphasised.

To meet its steel production goals, the report recommends a comprehensive, five-pronged strategy, focusing on:

• Boosting investments in green and value-added steel,

• Improving infrastructure and raw material linkages,

• Accelerating adoption of clean technologies,

• Implementing policy reforms for financing and regulatory clearances,

• Strengthening public-private partnerships for efficient execution.

Driven by rapid industrialisation and infrastructure development, India has witnessed significant growth in steel production, solidifying its position as the world’s second-largest steel producer after China, which currently accounts for more than half of global steel output.

The report concluded that India is well-positioned to expand its steel industry, backed by strong infrastructure demand, favourable policy support, and global supply chain shifts.

With inputs from IANS