India has the potential to significantly increase its steel production capacity, – an expert

The future of India’s steel industry will be shaped by players who focus on demand clusters and value-added products. This forecast comes from Vijay Sarathi Atreyapurapu, managing partner of AVVA Consultancy Group

In his view, India’s goal of reaching a steel production capacity of 300 million tons by the 2030/2031 fiscal year is becoming a realistic operational scenario. Specifically, an 85% capacity utilization rate by the announced deadline would ensure the production of approximately 255 million tons of steel.

At the same time, the expected consumption of rolled steel at 220–230 million tons requires growth in certain sectors; in that case, a figure of 260 million tons could be reached by the 2030/2031 fiscal year. This growth, in particular, could be driven by sectors such as infrastructure and construction—which are capable of making the largest contribution—urban housing and real estate, the automotive and machinery industries (with a shift toward high-quality steel), renewable energy, and the defense sector.

The expert identifies India’s transition from volume growth to increased demand for value-added steel, the distribution of consumption across the country rather than its concentration in cities, and the creation of cyclical demand driven by policy and supported by infrastructure projects as structural changes.

However, the analyst warns that attention should also be paid to key issues such as the security of raw material supplies (iron ore, coking coal), logistics, and capital discipline during expansion.

As a reminder, India aims to expand its steel production capacity to 400 million tons by the 2035/2036 fiscal year. This is envisaged by the proposed National Steel Policy 2025. According to a March draft government memo, the country will need capital investments of approximately 17 trillion rupees ($183.41 billion) to achieve this goal.

India also aims to more than double its exports to 20 million tons. Additionally, the new policy for the steel sector calls for reducing dependence on coking coal imports to 80% by the 2035/2036 fiscal year, down from approximately 90% currently.