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Last Updated: October 01, 2015
L N Mittal
President and CEO, Arcelor-Mittal
Last Updated: September, 2015
SECTORAL REPORT | August, 2015
METALS AND MINING SECTOR REPORT | August, 2015
India is the world’s third-largest producer of crude steel (up from eighth in 2003) and is expected to become the second-largest producer by 2016. The growth in the Indian steel sector has been driven by domestic availability of raw materials such as iron ore and cost-effective labour. Consequently, the steel sector has been a major contributor to India’s manufacturing output.
The Indian steel industry is very modern with state-of-the-art steel mills. It has always strived for continuous modernisation and up-gradation of older plants and higher energy efficiency levels.
Steel production capacity of the country expanded from about 75 Million Tonnes Per Annum (MTPA) in 2009-10 to about 90.5 Million Tonnes (MT) in 2014-15.
India produced 7.4 MT of steel in the month of June 2015 reporting the third highest production level globally which was 0.8 per cent higher than the country's steel production in the same month last year.
The steel sector in India contributes nearly two per cent of the country’s gross domestic product (GDP) and employs over 600,000 people. The per capita consumption of total finished steel in the country has risen from 51 Kg in 2009-10 to about 59 Kg in 2014-15. India's steel consumption for FY 2015-16 is estimated to increase by 7 per cent, higher than 2 per cent growth last year, due to improving economic activity, as per E&Y's 'Global Steel 2015-16' report.
Steel industry and its associated mining and metallurgy sectors have seen a number of major investments and developments in the recent past.
According to the data released by Department of Industrial Policy and Promotion (DIPP), the Indian metallurgical industries attracted foreign direct investments (FDI) to the tune of US$ 8.7 billion, respectively, in the period April 2000–May 2015.
Some of the major investments in the Indian steel industry are as follows:
The Government of India is aiming to scale up steel production in the country to 300 MT by 2025 from 81 MT in 2013-14.
The Ministry of Steel has announced to invest in modernisation and expansion of steel plants of Steel Authority of India Limited (SAIL) and Rashtriya Ispat Nigam Limited (RINL) in various states to enhance the crude steel production capacity in the current phase from 12.8 MTPA to 21.4 MTPA and from 3.0 MTPA to 6.3 MTPA respectively.
The Ministry of Steel is facilitating setting up of an industry driven Steel Research and Technology Mission of India (SRTMI) in association with the public and private sector steel companies to spearhead research and development activities in the iron and steel industry at an initial corpus of Rs 200 crore (US$ 31.67 million).
Some of the other recent government initiatives in this sector are as follows:
India is expected to become the world's second largest producer of crude steel in the next 10 years, moving up from the third position, as its capacity is projected to increase to about 300 MT by 2025. Huge scope for growth is offered by India’s comparatively low per capita steel consumption and the expected rise in consumption due to increased infrastructure construction and the thriving automobile and railways sectors.
Exchange Rate: INR 1 = US$ 0.0152 as on September 18, 2015
References: Media reports, Press Releases, Press Information Bureau, Department of Industry Policy and Promotion, Ministry of Steel, Confederation of Indian Industries
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
India is tyhe world's largest producer of crude steel, and is currently doubling its production capacity.
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