What Makes India The Second Largest Producer of Crude Steel?

What Makes India The Second Largest Producer of Crude Steel?

What Makes India The Second Largest Producer of Crude Steel?

On 1st February, 2020, INDIA became the second largest producer of crude steel, ranking behind China. India’s crude steel production moved to 111.2 million tonnes in 2019, as revealed by the Minister of Steel and Mines, Shri Dharmendra Pradhan, quoting data from the World Steel Association. Japan climbed down to the third place with 99.3 million tonnes in 2019, followed by the US and South Korea.

This was an astonishing development since the Government of India did not and does not set any annual targets for steel production as it is a deregulated sector. The Minister had confirmed that individual companies took the decision on the quantity of steel production, based on their commercial considerations and market requirements.


Before the Ministry of Steel laid down an ambitious 5 year vision for driving steel production, a World Steel Study of India conducted in collaboration with the Indian Steel Association had identified the rapid growth of the construction sector and its strong demand on the back of strong infrastructure development and housing demand, especially affordable housing, as essentials for increased steel production.

Taking a cue from this revelation, the Ministry of STEEL under the 100 days agenda of the Government had prioritised five initiatives that not only offered potential impact on ease of doing business / living and employment generation but also drove tangible outcomes.

  • FRAMEWORK POLICY ON CREATION OF STEEL CLUSTERS: Aimed at galvanising the MSMEs in the steel sector, this policy looks to boost production of value-added products, drive import substitution, and help create healthy employment in the steel sector.
  • STEEL SCRAP POLICY: This policy aims at ensuring adequate availability of scrap for steel manufacturers which in turn will reduce imports and improve Indian steel sector’s competitiveness.
  • SAFETY GUIDELINES: A working group was constituted for developing model guidelines of safety practises for Iron and Steel sector. These guidelines already in place, ensures healthy and safe working environment with protection against possible hazards.
  • STEEL IMPORT MONITORING SYSTEM (SIMS): This envisioned an institutional mechanism in league with DGFT for steel import monitoring. This would help protect domestic producers and ensure their sustainability in responding to market conditions.
  • RAW MATERIAL SECURITAZATION: Working closely with the Ministry of MINES, the Ministry of STEEL has initiated short and long-term measures for raw material security.

Apart from the above, the Central Government had taken several other measures like encouraging domestic manufacturing and procuring capital goods for steel; promoting R&D for the Indian steel sector; improving trade balance for the steel sector; facilitating development of skilled manpower; ensuring sufficient infrastructure and logistics capacity for the steel sector, etc.

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