India Steel Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

India Steel Market Analysis

The India Steel Market size is estimated at 148.28 million tons in 2025, and is expected to reach 230.03 million tons by 2030, at a CAGR of 9.18% during the forecast period (2025-2030).

India has established itself as a global steel manufacturing powerhouse, currently holding the position of the world's second-largest producer of crude steel after surpassing Japan. The country's steel sector demonstrated robust production capabilities in FY23, achieving an annual output of 125.32 million tons of crude steel and 121.29 million tons of finished steel. The industry has also maintained a strong trade position, with net exports reaching 6.72 million tons against imports of 6.02 million tons in FY 2022-23, highlighting India's growing self-sufficiency and export capabilities in steel production.

The steel industry's landscape is experiencing significant consolidation and expansion through strategic acquisitions and investments. Notable developments include JSW Steel's acquisition of NSL Green Steel Recycling in September 2023, aimed at establishing a scrap shredder facility in Maharashtra to reduce carbon footprint. Similarly, Jindal Stainless Limited's acquisition of a 74% stake in Odisha-based Jindal United Steel Limited for INR 958 crore in July 2023 demonstrates the industry's focus on vertical integration and capacity expansion. These strategic moves are reshaping the competitive landscape and enhancing operational efficiencies.

Despite its strong position, the Indian steel industry faces several structural challenges that impact its global competitiveness. The country's per capita steel consumption stands at 86.6 kilograms, significantly below the global average of 228 kilograms in FY 2022-23, indicating substantial untapped domestic market potential. Additionally, the industry grapples with high logistics costs, with steel freight rates approximately 500% higher compared to countries like Australia, substantially impacting operational costs and international competitiveness.

The industry is witnessing a notable shift towards sustainable and efficient production methods. AM/NS India's approval for a USD 4.7 billion steel plant project in Odisha in January 2023 represents the industry's commitment to modernization and capacity expansion. The sector is increasingly focusing on technological advancements, particularly in areas such as green steel production and energy efficiency. This transformation is crucial given that approximately 50% of the Indian workforce remains in agricultural operations, presenting both a challenge and opportunity for industrial growth and skilled labor development.

India Steel Market Trends

Strong Policy Support by the Indian Government

The Indian government has implemented comprehensive long-term support policies to strengthen the domestic steel sector, with the National Steel Policy 2017 serving as a cornerstone initiative. Through this policy, the government aims to develop India into a technologically advanced steel manufacturing hub, focusing on achieving a total crude steel capacity of 300 MTPA by 2030-31. The policy framework specifically targets the expansion of state-owned entities, with plans to increase SAIL's operational capacity from the existing 19.51 MTPA to approximately 35.65 MTPA by 2030-31. Additionally, the government's Production Linked Incentive (PLI) Scheme, approved with an outlay of INR 6,322 crore, is scheduled to commence from FY 2023-24, demonstrating the government's commitment to boosting domestic production.

The government has also introduced targeted policies to promote domestic manufacturers and enhance quality standards in the steel sector. The Domestically Manufactured Iron and Steel Products (DMI & SP) Policy, implemented for government procurement, has successfully resulted in import substitution worth INR 34,800 crore (USD 4,176.7 million). To ensure product quality, 145 Indian Standards have been notified under the Quality Control Orders covering various steel materials. Furthermore, the government launched the region-specific Mission Purvodaya to accelerate development in Eastern India through an integrated steel hub in Kolkata, recognizing that the eastern region has the potential to contribute more than 75% of the country's incremental steel capacity, potentially adding over 200 MT of the targeted 300 MT capacity by 2030-31.

Strong Influx of Investments in the Steel Sector

The Indian steel sector has witnessed substantial investment commitments from both domestic and international players, reflecting strong confidence in the market's growth potential. Through the production-linked incentive scheme for specialty steel, the government has successfully attracted investment commitments worth INR 400 billion (USD 5.37 billion), aimed at expanding specialty steel capacity. In a significant development in July 2023, the Ministry of Steel announced a massive investment of JPY 5 trillion (USD 36 billion) from Japan across various sectors in India, including steel, marking a major boost for international collaboration in the sector.

Major industry players have announced significant expansion plans, demonstrating their commitment to the sector's growth. AMNS India has unveiled plans to invest USD 7.4 billion in expanding both its upstream and downstream capacities while enhancing its iron ore capabilities. Similarly, INOX Air Products announced an investment of INR 1,300 crore (USD 157.5 million) in May 2023 to improve process efficiency, while JSW Steel committed INR 47,457 crore (USD 6.36 billion) for manufacturing capacity expansion and mining infrastructure development in Odisha. These investments are complemented by over 57 MoUs involving 27 companies under various government schemes, with committed investments of nearly INR 30,000 crore aimed at adding downstream capacity of 24.7 million tons.

Increasing Urbanization and Increased Spending on Construction and Infrastructure Projects

India's construction and infrastructure sectors are experiencing unprecedented growth, driven by rapid urbanization and increased government spending on development projects. According to the National Investment Promotion and Facilitation Agency, the construction industry currently employs over 51 million people and accounts for 9% of India's GDP. The sector has witnessed remarkable growth in housing demand, with the top seven cities (Delhi NCR, Bangalore, Hyderabad, Mumbai, Pune, Chennai, and Kolkata) recording approximately 402,000 new housing units in 2022, representing a 44% increase from the previous year. This growth trajectory is expected to continue as projections indicate that more than 40% of India's population will reside in urban areas by 2030, creating demand for an additional 25 million affordable housing units.

The government has demonstrated strong commitment to infrastructure development through substantial budget allocations and ambitious projects. In 2022-23, the government allocated INR 64,573 crore for developing new roads and bridge infrastructure, while committing INR 2,600 crore for non-residential office buildings under the Central Vista Project. The implementation of transformative programs such as the Smart City Mission, targeting 100 cities, and the National Infrastructure Pipeline (NIP) with projects worth INR 108 trillion (USD 1.3 trillion) at various implementation stages, further reinforces the government's focus on infrastructure development. Additionally, social sector initiatives like the Pradhan Mantri Awas Yojana and the Sardar Patel Urban Housing Project are actively promoting housing development, creating sustained demand for construction steel and structural steel in the construction sector.

Segment Analysis: Basic Form

Crude Steel Segment in India Steel Market

Crude steel represents the entirety of India's basic form steel manufacturing, serving as the fundamental raw material for all steel products in the country. In 2024, crude steel production continues to dominate the basic form segment with approximately 100% market share, reflecting its critical role in India's steel manufacturing ecosystem. The segment's robust performance is supported by major steel producers like Steel Authority of India Limited (SAIL), Tata Steel, and JSW Steel, who have significantly invested in expanding their crude steel production capabilities. The production is primarily driven by the strong demand from various end-user industries, including construction, automotive, and infrastructure development. The government's supportive policies, including the National Steel Policy and Production Linked Incentive (PLI) scheme, have further strengthened the crude steel segment's position in the market.

Growth Trajectory of Crude Steel Segment

The crude steel segment is projected to maintain a strong growth trajectory, with an expected growth rate of approximately 8% during the forecast period 2024-2029. This growth is primarily driven by the government's ambitious target to achieve 300 MTPA of steel production capacity by 2030-31. The segment's expansion is further supported by significant investments in new technologies and production facilities. Major steel manufacturers are increasingly adopting advanced technologies like blast furnace-basic oxygen furnace (BF-BOF) and electric arc furnace (EAF) to enhance production efficiency and meet environmental standards. The segment's growth is also bolstered by increasing urbanization and the government's focus on infrastructure development projects across the country.

Segment Analysis: Final Form

Crude Steel Segment in India Steel Market

Crude steel maintains its position as the dominant segment in India's steel market, accounting for approximately 53% of the total production volume in 2024. This segment's prominence is primarily attributed to India's position as the world's second-largest producer of crude steel, surpassing major steel-producing nations. The segment's strength is reinforced by the country's robust integrated steel manufacturing facilities, with major players like Steel Authority of India Limited (SAIL) operating multiple blast furnaces across various locations. The government's supportive policies, including the National Steel Policy and Production Linked Incentive (PLI) Scheme, have further bolstered crude steel production. Additionally, the segment benefits from India's abundant iron ore reserves and growing domestic demand from various end-user industries, particularly construction and infrastructure development.

Finished Steel Segment in India Steel Market

The finished steel segment is demonstrating remarkable growth potential in India's steel market, with an expected growth rate of approximately 9% during 2024-2029. This accelerated growth is driven by several factors, including the government's ambitious infrastructure development plans and increasing urbanization. The segment is witnessing substantial investments in capacity expansion, with major players like JSW Steel and Tata Steel announcing significant expansion projects. The implementation of quality control orders by the government has also enhanced the segment's competitiveness in both domestic and international markets. Furthermore, the growing demand from automotive, construction, and consumer goods sectors, coupled with India's push towards manufacturing self-reliance through initiatives like 'Make in India,' is expected to sustain this segment's robust growth trajectory.

Segment Analysis: Technology

Blast Furnace-Basic Oxygen Furnace (BF-BOF) Segment in India Steel Market

The Blast Furnace-Basic Oxygen Furnace (BF-BOF) route dominates India's steel production landscape, commanding approximately 46% of the total market share in 2024. This technology represents the most basic, robust, and highly efficient method of steel production, using iron ore as its primary raw material, which accounts for about 50% of the manufacturing cost. The segment's prominence is attributed to its superior production capabilities, with blast furnaces capable of producing up to 10,000 tons of molten pig iron daily and Basic Oxygen Furnaces able to produce up to 300 tons of steel per heat. The technology's efficiency is demonstrated by its ability to convert up to 90% of iron ore into molten pig iron in less than 30 minutes, while BOFs can transform molten pig iron into steel within the same timeframe. The segment's growth is further supported by significant capacity expansions across major players, with companies like Tata Steel BSL Ltd. planning to add 6.07 MMT of BOF capacity at the Meramandali works, and JSW Steel advancing the construction of 5 MMT of BOF capacity at its Vijayanagar Works. The segment is projected to maintain its strong growth trajectory through 2024-2029, with an expected growth rate of approximately 9% annually, driven by its vital role in India's economy and continuous improvements in efficiency and environmental performance.

Remaining Segments in Technology

The Electric Arc Furnace (EAF) and Other Technologies segments complete the technological landscape of India's steel market. The EAF segment has established itself as a significant alternative to the traditional BF-BOF route, particularly in producing specialty steels that require precise control of chemistry and microstructure. This technology offers advantages in terms of energy efficiency, using only about 20% of the energy required by the BF-BOF route, and demonstrates greater environmental friendliness due to its reduced carbon footprint. The Other Technologies segment, primarily dominated by Induction Furnace (IF) technology, serves as a promising alternative for smaller steel mills due to its compact nature and flexibility in feedstock utilization. These technologies complement the market by offering specialized solutions for different production needs, with EAF being particularly suitable for high-quality alloy and stainless grades, while IF technology provides advantages in terms of energy efficiency and reduced environmental impact, making it ideal for smaller-scale operations and specific market niches.

Segment Analysis: End User Industry

Building and Construction Segment in India Steel Market

The building and construction sector maintains its dominance in the Indian steel market, accounting for approximately 51% of the total market share in 2024. This segment's prominence is driven by extensive infrastructure development initiatives and rapid urbanization across the country. The government's strong focus on infrastructure development through various initiatives and increased spending on construction projects has significantly boosted construction steel demand in this sector. According to the National Investment Promotion and Facilitation Agency, the building and construction industry is projected to reach USD 1.4 trillion by 2025, demonstrating the sector's robust growth trajectory. The segment is also experiencing the fastest growth rate of around 10% for the forecast period 2024-2029, primarily driven by ambitious government projects, growing residential construction activities, and expanding commercial infrastructure development. The expansion of Grade A office spaces in major cities, coupled with the government's commitment to developing smart cities and affordable housing schemes, continues to fuel the demand for steel in construction applications.

Remaining Segments in End User Industry

The automotive steel and transportation sector represents the second-largest consumer of steel in India, driven by the country's expanding automotive manufacturing capabilities and transportation infrastructure development. The tools and machinery segment maintains steady growth, supported by increasing industrialization and the government's push for domestic manufacturing through initiatives like 'Make in India'. The consumer goods sector's demand for steel continues to rise, particularly in appliances and packaging applications, while the energy sector utilizes steel extensively in power generation infrastructure, renewable energy installations, and distribution networks. Each of these segments contributes uniquely to the market's dynamics, with the automotive sector focusing on high-strength steel variants, the tools and machinery segment demanding precision-grade materials, and the consumer goods sector requiring specialized steel products for various applications. The energy sector's transformation, particularly in renewable energy infrastructure, is creating new opportunities for steel applications in solar, wind, and hydroelectric power installations.