The Indian steel industry is facing significant challenges as domestic manufacturers call for additional government measures to curb rising imports, particularly from China. The situation highlights a growing disparity between Chinese and Indian steel production, with potential implications for the domestic market and policy landscape.

Production Disparity and Import Pressure

China's dominance in steel production is evident from recent data:

This substantial gap in production volumes has contributed to increased import pressure on the Indian market. Notably, the stainless steel sector in India is operating at only 60% of its 7.5 million tonnes installed capacity due to this import influx.

Government Measures and Industry Response

In response to these challenges, the Indian government has implemented several measures:

1. Over 100 quality control orders (QCOs) to restrict non-BIS compliant steel products.
2. The Directorate General of Trade Remedies (DGTR) recommended a 12% provisional safeguard duty for 200 days on certain steel products in March.
3. A high-level committee from NITI Aayog is scheduled to meet with steel industry leaders to discuss import-related issues.

Despite these efforts, the industry continues to face headwinds:

• Domestic steel prices dropped to a five-year low in October, influenced by surging imports.
• India has been a net steel importer for six consecutive months, with September imports reaching 0.79 MT of finished steel.
• In the first half of the fiscal year, India's inbound shipments exceeded exports by 0.47 MT, despite a 40% rise in export volumes to 4.43 MT.

Economic Implications and Policy Outlook

The Reserve Bank of India (RBI) has highlighted the surge in steel imports, attributing it to lower import prices and calling for policy support. This situation presents a complex challenge for policymakers, balancing the needs of domestic producers against broader economic considerations.

As the government and industry stakeholders prepare for upcoming discussions, the focus will likely be on developing strategies to enhance the competitiveness of Indian steel manufacturers while managing the impact of global market dynamics on the domestic industry.

The outcome of these deliberations could have significant implications for India's steel sector, potentially shaping trade policies and industrial strategies in the coming months.

In a significant move towards sustainable steel production, India has set an ambitious target of 300 million tonnes of green steel production by 2030. This initiative comes as a strategic response to the European Union's impending Carbon Border Adjustment Mechanism, which will impose tariffs on steel imports based on their carbon content.

Government's Push for Green Steel

Minister of New and Renewable Energy, Pralhad Joshi, has urged steel manufacturers to accelerate green steel production with a five-star rating system. This push is aimed at avoiding potential export barriers arising from carbon taxes in international markets.

Key Targets and Initiatives

• Production Target: 300 million tonnes of green steel by 2030
• Export Goal: 50 million tonnes of green steel exports by 2030
• Green Hydrogen Projects: Five pilot projects underway in the steel sector
• Green Hydrogen Hubs: Development of seaports at Kandla, Paradip, and Tuticorin

Financial Commitments and Incentives

The government has demonstrated its commitment to the green transition through substantial financial allocations:

• Nearly ₹20,000 crores distributed under the Green Hydrogen Mission
• Incentives awarded for 3,000 MW of electrolyser manufacturing

Cost Reduction Goals

The government aims to significantly reduce the costs associated with green hydrogen production:

• Target: Bring green hydrogen costs to under $2
• Green Ammonia: Auction costs have dropped from over ₹100 per kg to ₹49.75 per kg

Environmental and Economic Impact

The green steel initiative is expected to have far-reaching effects:

• Carbon Emission Reduction: 50 million tons
• Job Creation: 6 lakh jobs through 125 GW capacity addition

Global Context

This move by India is particularly significant in light of the EU's Carbon Border Adjustment Mechanism. By focusing on green steel production, India is positioning its steel industry to remain competitive in the global market while also contributing to environmental sustainability.

The shift towards green steel production represents a major step in India's commitment to reducing its carbon footprint while maintaining its position as a key player in the global steel industry. As these initiatives unfold, they are likely to reshape the landscape of steel production not just in India, but potentially on a global scale.