India’s steel demand to grow 7.5% in 2023-24, industry body says

Steel is regarded as the heartthrob of the construction industry of India. Pertaining to the same, recently, our steel demand has risen to a whopping 7.5%. Sounds great, right? In today’s blog, Sigma Pipes will be telling you about this tremendous rise in demand for steel. So, without any further ado, let’s get started:

The News

The steel industry in India has been benefiting from the country’s robust economic growth, with sectors like automotive and consumer durables contributing to the increased steel consumption. 

According to a leading industry body, India’s steel consumption is projected to increase by 7.5% in the current fiscal year until March 2024. This growth is driven by the escalating demand from the domestic construction, railways, and capital goods sectors. India ranks as the world’s second-largest producer of crude steel, with output reaching a record 125.3 million tonnes in 2022-23, marking a 4.2% increase. However, global demand weighed down India’s steel exports, leading to a five-year low during the financial year that concluded in March 2023.

ISA’s Stance

The Indian Steel Association (ISA) stated that steel demand is expected to reach 128.9 million tonnes in 2023-24, up from 119.9 million tonnes in the previous year. Economists predict that India’s economy, the third-largest in Asia, will grow at an average rate of 6.0% for the current fiscal year and rise to 6.4% in 2024-25, as per a Reuters poll. The ISA highlighted that infrastructure spending and urban consumption will sustain the momentum in steel demand, resulting in an annual expansion of 8-9 million tonnes over the next two financial years. The top executive of JSW Steel Ltd, the largest steelmaker in India, estimated a 7%-8% increase in steel demand for this year.

India has emerged as a major player in the global steel market, with the country’s steel production capacity growing significantly in recent years. The government’s focus on infrastructure development and initiatives such as “Make in India” have contributed to the growth of the steel sector. The steel industry in India is dominated by both integrated steel plants and secondary steel producers. Integrated steel plants are large-scale facilities that produce steel from iron ore, while secondary steel producers use recycled scrap metal as their raw material.

Indian Steel Industry

In terms of production, India’s steel industry has seen substantial growth. The country’s crude steel production reached 111.2 million tonnes in 2020, making it the second-largest producer in the world, behind only China.

The government has implemented various measures to support the steel industry, including the introduction of safeguards and anti-dumping duties to protect domestic manufacturers from cheap imports. Additionally, reforms such as the Goods and Services Tax (GST) have aimed to streamline the tax structure and boost the ease of doing business in the sector. Apart from meeting domestic demand, India has also become an important player in the global steel market. The country exports steel to various countries, including the United States, United Arab Emirates, and Nepal. However, as mentioned earlier, steel exports from India faced challenges in recent years due to sluggish global demand. To ensure sustainable growth and meet increasing domestic demand, the Indian steel industry is focusing on enhancing efficiency, adopting advanced technologies, and investing in research and development. Companies are also exploring new markets and diversifying their product portfolios to cater to evolving 

customer needs.

The Bottom Line

Overall, the steel industry in India plays a vital role in the country’s economic development, providing employment opportunities and contributing to various sectors such as infrastructure, automotive, and manufacturing. With the government’s continued support and favorable market conditions, India’s steel industry is poised for further growth in the coming years.
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