[Asian Steel Watch] Vol.4 (2017.12)
On the Cover Opportunities and Challenges of the Indian Steel Industry in the Context of Future Growth
India has always been seen as a potential for significant steel market expansion. There have been various forecasts at different points, raising expectation of the steel industry and investors about growth prospects of the industry. In the recently adopted steel policy of the government of India, it has stated that India’s crude steel production capacity will have to reach 300 Mt by the year 2030-31, from the current level of about 125 Mt, which incorporates a domestic finished steel consumption forecast of about 225 Mt and export of about 20 Mt. However, the government’s goal is rather optimistic in light of varying structural issues of the Indian steel industry, including delayed projects, high debts, low labor productivity, operation inefficiency, and lack of infrastructure. Overcoming such mounting challenges, the Indian steel industry should move forward taking into account the impact of scrap generation on India’s competitiveness in raw materials, impact of environmental regulations on new investment, and impact of speculative assets on steel prices.