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Steel Industry in India

January, 2013


India has acquired a central position on the global steel map, on back of ever increasing demand from sectors like infrastructure, real estate and automobiles, at home and abroad. India was ranked the world's fourth largest crude steel capacity in 2011-12 and is expected to become the second largest producer of crude steel in the world by 2015-16. India is also the world's largest producer of sponge iron with a host of coal based units located in its mineral-rich states.

"With modernisation programmes of various public and private companies, the country will soon rise to second place," as per Dr Manmohan Singh, the Prime Minister of India.

India's steel making capacity is estimated to exceed 100 million tonnes (MT) by 2013 and the production is expected to reach 275 MT by 2020. The per capita steel consumption increased from 34 kilograms (kg) in 2004-05 to 59 kg in 2011-12.

Market Size

The World Steel Association has estimated steel consumption in India to grow at five per cent in 2013. "Steel producers may see a spurt in demand in the medium term if the Indian Government implements its US$ 1 trillion infrastructure investment plan," as per India Ratings. India's steel-making capacity is slated to cross 100 MT in 2013 that will require about 160-170 MT of iron ore.

The steel industry is expected to add 12.8 MT of capacity in the second half of 2012-13, with the major contributors identified as SAIL (3.4 MT), RINL (2.3 MT), Bhushan Steel (2.1 MT) and Jindal Steel (2 MT).

Indian crude steel production is estimated to grow at a compound annual growth rate (CAGR) of around 10 per cent during 2010-2013, whereas the finished steel consumption is estimated to grow at a CAGR of around 12 per cent during FY 2012-14, as per a RNCOS research report titled, 'Indian Steel Industry Outlook to 2012'.

In addition, the Indian Bureau of Mines estimates the current pelletisation capacity in India to be around 20 million tonnes per annum (MTPA).

  • Steel Authority of India Ltd (SAIL) has recorded a growth of 8 per cent during November 2012 compared to the same month last year. The public sector company produced 972,000 tonnes of saleable steel during November 2012
  • Bhilai Steel Plant has registered growth of 4.1 per cent, 5.3 per cent and 5.3 per cent in hot metal, crude steel and saleable steel production respectively during April-December 2012, as compared to the same period last year


  • SAIL plans to invest US$ 8 billion in Chhattisgarh. SAIL also plans to enhance the capacity of its Bhilai steel plant from 4 MTPA to 10 MTPA
  • JSW Steel and Japan-based JFE Steel Corporation have signed a joint agreement. JFE will provide technology for the production of non-oriented electrical steel sheets at the JSW Steel's Vijayanagar plant in Karnataka
  • The sinter plant at the upcoming IISCO Steel Plant (ISP) of SAIL commenced production. The Rs 704 crore (US$ 128.94 million) project is part of the 2.5 MTPA integrated steel plant under construction at Burnpur near Asansol in West Bengal
  • Mittal Corp is setting up a 1.5 MTPA pellet and beneficiation plant in Karnataka, while JSPL is in the process of setting up a 4 MTPA pellet plant in Orissa
  • Essar Projects has set up an 8 MTPA pellet plant in Vizag and 6 MTPA plant in Paradip for Essar Steel