India is considering introducing a requirement for green steel in public procurement

India is considering the phased introduction of a mandate for green steel in public procurement, according to The Economic Times.

According to the Confederation of Indian Industry (CII), the country could unlock up to 16 million tons of certified green steel supplies from manufacturers by the 2029/2030 fiscal year if a 26% commitment to low-carbon steel products in public procurement is introduced.

According to the CII report, produced with the support of Climate Catalyst, the country’s industrial ecosystem is generally ready to implement green public procurement (GPP) for steel if this policy becomes mandatory. This would potentially create the country’s first large-scale guaranteed market for certified low-carbon steel products by fiscal year 2007/2028.

Public procurement is estimated at 45-50 trillion rupees per year (over $500 billion). At the same time, government infrastructure and development projects consume about 31.6 million tons of steel. These activities resulted in emissions of approximately 70 million tons of carbon in fiscal year 2023/2024.

The researchers analyzed responses from 28 manufacturers that produce approximately 88 million tons of steel per year, as well as 12 major government procurement agencies. 93% of the manufacturers surveyed are ready to supply certified “green” steel on a large scale, provided that the government gives clear authority and provides mechanisms for reimbursement of costs (price premium, VAT exemptions, carbon credit compensation).

Government agencies, in turn, note four key factors necessary to launch such procurement: a national mandate with defined percentage thresholds, standardized tender provisions and monitoring templates, procurement training, and time-limited financial support in the initial stages.

It should be recalled that in December 2024, India’s Ministry of Steel announced a formula for determining green steel. The agency classifies it into three categories depending on the amount of carbon emissions per ton of alloy produced.