Business EconomyPosted at: Oct 11 2026 2:22PM


India targets 604 MT steel capacity by 2047, puts focus on decarbonisation

New Delhi, Oct 11 (UNI) The government has unveiled a draft National Steel Policy 2047, setting an ambitious target of expanding India's crude steel production capacity to 604 million tonnes (MT) by 2047, while strengthening domestic raw material availability, improving industrial competitiveness and reducing dependence on imports.
The policy envisages finished steel demand reaching 505 MT by 2047, alongside an increase in per capita steel consumption to 302 kg and exports to 45 MT. It outlines a long-term roadmap for the sector, with priorities spanning raw material security, cleaner production, technology adoption, product quality and the development of domestic manufacturing capabilities.
Raw materials account for nearly 65-70 per cent of steel production costs, making supply security a key concern for the industry. Although India is largely self-sufficient in iron ore, it imports around 92 per cent of its coking coal requirements. The draft policy proposes reducing this dependence through increased domestic mining, expansion of coal washeries, overseas asset acquisitions, long-term supply agreements and the use of artificial intelligence (AI) to optimise coal blends.
The government has also identified manganese, limestone and other essential inputs as priority areas to ensure the long-term sustainability of the steel industry. Diversifying sourcing channels and strengthening domestic supply chains are expected to play a critical role in supporting the sector's expansion.
The secondary steel industry, which comprises approximately 2,550 units and accounts for nearly 47 per cent of India's crude steel production capacity, is another key focus area. The policy proposes measures to improve raw material access, upgrade technology, strengthen workforce skills and enhance workplace safety across these units.
Decarbonisation forms a central pillar of the proposed policy as India seeks to expand steel production while addressing the sector's carbon footprint. Steelmaking accounts for around 10-12 per cent of the country's carbon dioxide emissions, with the industry's average emission intensity estimated at 2.54 tonnes of CO2 per tonne of crude steel, significantly higher than the global average of 1.92 tonnes.
The National Steel Policy 2047 outlines a phased transition towards achieving India's broader Net Zero target by 2070. The proposed measures include improving energy efficiency, increasing the use of renewable electricity, expanding scrap utilisation and promoting hydrogen-based steelmaking technologies.
The policy also seeks to accelerate the production of value-added steel, including stainless steel and speciality steel, to strengthen domestic manufacturing and reduce reliance on imported materials and technologies. Other proposed measures include developing a domestic scrap ecosystem, establishing downstream manufacturing clusters, encouraging indigenous technology development and aggregating demand to improve industrial efficiency.
The establishment of Centres of Excellence is also envisaged to support research, innovation and technology development across the steel value chain.
Digitalisation is emerging as another priority, with the government proposing investments in digital infrastructure, common data standards and Industry 4.0 technologies. The adoption of trusted AI applications and autonomous production systems is expected to improve manufacturing efficiency, operational performance and competitiveness.
The draft policy proposes strengthening quality standards through revised Indian Standards and improved conformity assessment mechanisms. The government will also continue efforts to curb imports of substandard and low-quality steel through AI-supported import monitoring and other trade remedial measures, while encouraging exports of quality steel.
International cooperation is expected to gain importance, particularly in securing raw materials, diversifying supply sources, facilitating steel trade and promoting technology partnerships. As the world's second-largest steel producer and consumer, India aims to work with other countries to strengthen the sector's long-term growth and competitiveness.
The proposed policy comes against the backdrop of a significant expansion in India's steel industry over the past decade. The government introduced the National Steel Policy in 2017, targeting an increase in domestic steelmaking capacity to 300 MT by 2030, alongside higher per capita consumption and improved raw material availability.
India's crude steel production has risen from approximately 89 MT in 2014-15 to 170 MT in 2025-26. Finished steel consumption more than doubled over the same period, increasing from 77 MT to 164 MT.
Despite this growth, domestic steel consumption remains below global levels. India's per capita steel consumption stood at 116 kg in FY26, compared with the global average of 209 kg, highlighting the potential for further expansion as infrastructure development and manufacturing activity gather pace. UNI VK AAB
Tags: #India targets 604 MT steel capacity by 2047# puts focus on decarbonisation
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