According to India Brand Equity Foundation, the steel industry in India has benefited immensely from the initiatives taken by the Indian government. The steel industry in India is an essential part of the country’s development, and it has applications in roads, railways, urban development, pipelines, automobiles, and power sectors. In FY25, India ranks second globally in the production of crude steel. The steel demand in India has estimated a CAGR of 8-9% YoY in 2025. This has been majorly driven by infrastructure development.
Steel in India accounts for about 2% of the country’s GDP, provides over 6,00,000 jobs in the industry and around 2 million jobs in the industry’s economic spillover effect, while boasting jobs multipliers of 6.8 times and product multipliers of 1.4 times, respectively. Steel production in India is very much in sync with the country’s quest for the attainment of a Rs. 4,43,90,000 crore (US$ 5 trillion) economy by 2027, specifically through initiatives such as the Make in India program.
Market Outlook and Production Trends
During FY25, the production in India was at 151.14 million tonnes (MT), registered an increase of 4.7% from the production level in FY24, which was at 144.31 MT. Production of finished steel was at 145.31 MT, with the domestic consumption at 150.23 MT. Volatile conditions exist, and the steel industry in India has been very resilient. Crude steel production increased by 6.8% on a YoY basis during the first two months of 2025, although steel production contracted in various nations like Germany and Iran during the same period. Factors like the National Steel Policy (NSP) 2017, Production-Lined Incentive Scheme for Specialty Steel, and the Steel Import Monitoring System (SIMS) contribute significantly to the growth in India’s steel production and safeguard the country against any increase in import levels.
Evolution of Policies and Strategic Alignment
The National Steel Policy 2017 provided a basis for achieving sustainable growth, where the target for steel production capability and per capita consumption by 2030-31 has been set at 300 MT and 160 kg, respectively.
The PLI Scheme for Specialty Steel, initiated in July 2021, further solidified this by encouraging domestic production of high value-added steel. Paralleling this, SIMS was launched for the purpose of tracking and safeguarding domestic companies from any unjustified trade practices for imported steel.
Government Initiatives Encouraging Growth and Sustainability
PLI Scheme for Specialty Steel
The PLI Scheme operates on five product categories:
- Coated or plated
- High-strength and wear-resistant
- Specialty rails
- Alloy Steel Products, Steel Wires
- Electrical
The plan aims for 42 MT of specialty steel production per year in FY27.
As of March 2025, the companies have pledged an amount of Rs.27,106 crore (US$3.05 billion), out of which approximatelyRs.20,000 crore (US$2.25 billion) has already been invested. The projects proposed by these companies have created jobs for 9,000 people, while the government is expected to release incentives worthRs.2,000 crore (US$225.28 million)
In Round II (January 2025), 35 firms offered an incremental commitment of Rs. 25,200 crores (US$ 2.84 billion), with expected incentives of Rs. 3,600 crore (US$ 405.53 million)
Domestic Manufactured Iron & Steel Products (DMI&SP) Policies
The DMI&SP policy has been updated on the 25th of July, 2025. This forces the acquisition of completely local production of steel. This new policy incorporates even tighter localisation standards and relaxed conditions under the import list for Indian suppliers of technology.
Greening the Steel Industry
In March 2025, the Ministry of Steel launched "Greening the Steel Sector in India: Roadmap and Action Plan," to meet India’s net-zero target by 2070. These include:
- Categories of green steel based on carbon units per tonne
- National mission providing low-interest finance and risk guarantees worth Rs.5,000 crores (US$563.19mn)
- Adoption of Green Hydrogen, CCUS, & Renewable Energies
- A Public Procurement Policy to use Green Steel in infrastructure projects from FY28
Green Hydrogen Initiatives
To cut emissions from coal-based steel production, India is encouraging the production of green hydrogen through the DRI process for iron. In October 2025, PEDA and IISc Bangalore have signed an agreement to set up a pilot project to produce green hydrogen using biomass, especially paddy straw. This will help to control stubble burning and improve air quality, along with clean steel production.
Key Investments in the Steel Industry
Major investments portray confidence in the growth potential of steel in India:
- ArcelorMittal Nippon Steel India announced a Rs. 60,000 crore (US$ 6.76 billion) investment to expand Hazira capacity to 15 MTPA by FY27, with 70% green steel production.
- JSW Steel plans to invest over Rs. 50,000 crore (US$ 5.63 billion) to build 10 MTPA of green steel capacity near Salav.
- The JSW Group also announced a 25 MTPA plant in Gadchiroli and a 13.2 MTPA plant in Odisha, involving Rs. 65,000 crore (US$ 7.8 billion) in investment.
- At the February 2025 Bengal Global Business Summit, nearly 50% of the Rs. 26,000 crore (US$ 3.02 billion) investment proposals received by Jharkhand were steel-related.
The Road Ahead
India’s steel sector is poised for continued growth as a result of its strong domestic demand, proactive government policies, and large private investment. Various plans like NSP 2017, PLI Scheme, SIMS, DMI&SP policy, and Green Steel Roadmap are helping the steel sector evolve into a more competitive, self-dependent, and eco-friendly sector. With increased spending on infrastructure and matching the international low-carbon benchmark, steel will continue to remain a driving force for the growth of India’s economy in the future decade as well.
＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊
BASUNDE, Rohini（Global PR & Reporter ）
Based in India, Rohini works as a Reporter and Global PR professional,
leveraging her strong background in culture, society, and media studies.
Her work primarily involves article writing and managing global public relations campaigns.
Her core areas of interest are multiculturalism, intercultural understanding, and cross-cultural communication,
through which she disseminates information from a truly international perspective.
Hobbies: Drawing, photography, editing, traveling, and cooking.
If you have any business in India, please feel free to contact us via MIRU’s “Contact Us” form or by phone.
＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊
