India will release a draft steel policy within a week that targets more than 600 million tonnes of annual capacity by 2047, almost three times today's level. Feeding those mills will need far more iron ore and coking coal.
At a glance
- The draft policy aims for over 600 million tonnes of steelmaking capacity and over 500 million tonnes of consumption by 2047.
- India's capacity stood at about 220 million tonnes at the end of the 2025-26 financial year.
- A Rs 5,000 crore scheme would reward small steelmakers for cutting carbon emissions.
Background
India sets long-range goals for its steel industry through a National Steel Policy. The current version dates from 2017 and aimed for 300 million tonnes of capacity by 2030-31. Steel is made mainly from iron ore and coking coal, so any capacity target is also a statement about how much of those raw materials the country will need.
What happened
Steel Secretary Sandeep Poundrik said on Tuesday that the government will publish a draft National Steel Policy for public comment within about a week. "In about a week, we will put this policy into the public domain for consultation and for comments from stakeholders," he said.
The draft targets more than 600 million tonnes of steelmaking capacity and more than 500 million tonnes of steel consumption by 2047. About 45 million tonnes of that demand is expected to come from exports, either as steel or as steel inside manufactured goods. India's capacity was about 220 million tonnes at the end of 2025-26.
What the policy includes
The new policy will replace the 2017 version, which only looked as far as 2030. It adds areas that barely featured then, including artificial intelligence, technology upgrades and decarbonisation. It aims to cut the average carbon intensity of Indian steel from 2.54 tonnes of carbon dioxide per tonne to 1.54 tonnes by 2047.
A proposed Rs 5,000 crore scheme would give small producers incentives linked to lower emissions. The draft also plans trade remedies, such as safeguard and anti-dumping duties, against cheap and substandard imports. Rolled steel imports rose 29.5% to 3.5 million tonnes between April and August.
What it means for raw materials
Nearly tripling capacity means a much bigger bill for inputs. India may need more than 700 million tonnes of iron ore a year by 2047. Poundrik named raw material availability and tighter global trade restrictions as the main obstacles.
The strategy leans on buying mining assets abroad and forming joint ventures to secure supply. For iron ore miners in India and abroad, the plan points to decades of rising Indian demand, if the mills actually get built.
Our read
Outlook: bullish. A plan to nearly triple steel capacity implies strong long-term Indian demand for iron ore. It is a 2047 target, though, so the effect on today's ore prices is small.
What to watch
- The full draft text once it is released for public comment, expected in early October.
- Details of the Rs 5,000 crore scheme for small steelmakers and how emission cuts will be measured.
- Any new safeguard or anti-dumping duties on steel imports.
For information only, not investment advice.
Iron price in India
metalscost.com India reference price as of 2026-10-03.
Detailed analysis
Timeline
- 2026-09-29: Steel Secretary Sandeep Poundrik says the draft National Steel Policy will be released for comment in about a week.
Demand Drivers
Steel consumption above 500 million tonnes by 2047 would need more than 700 million tonnes of iron ore a year.
Government Policies
The draft replaces the 2017 policy and adds a Rs 5,000 crore emissions-linked scheme for small producers.
Trade Tariffs
Safeguard and anti-dumping duties are planned after rolled steel imports rose 29.5% between April and August.
What could lift prices
- A near tripling of steel capacity would lift India's iron ore needs to more than 700 million tonnes a year.
- Curbs on cheap imports would push more steel demand towards domestic mills and their ore suppliers.
What could weigh on prices
- The target runs to 2047, so it does little for iron ore demand in the next few years.
- Poundrik himself flagged raw material shortages and trade restrictions as obstacles that could slow new mills.
Country impact
| Country | Impact | Reason |
|---|---|---|
| India | High | The policy sets the country's steel capacity, emissions and trade goals for the next two decades. |
| China | Medium | Planned anti-dumping and safeguard duties would affect exporters shipping cheap steel into India. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Steel | Positive | Domestic steelmakers get a growth roadmap and protection from cheap imports. |
| Iron Ore Mining | Positive | Ore demand could exceed 700 million tonnes a year by 2047. |
Who gains, who loses
- Small Indian steel producers: They would be eligible for the Rs 5,000 crore scheme tied to emission cuts.
- Iron ore miners: India's ore needs would rise sharply if capacity nears 600 million tonnes.
- Exporters of low-priced steel to India: Planned safeguard and anti-dumping duties would make their shipments costlier.
Other ways this could play out
- If raw material deals abroad fall short, capacity growth could stall well below 600 million tonnes.
- If import curbs work, domestic mills could fill more of India's demand and invest faster.
Price risks
- Long-dated targets often slip, so ore markets may give the plan little weight until mills are built.
- Weak steel demand in China matters far more to near-term iron ore prices than India's 2047 plan.
Historical comparison
- National Steel Policy 2017: The previous policy set a target of 300 million tonnes of capacity by 2030-31.
Technical view
Price is mixed relative to its 20-period and 50-period moving averages, showing no clear trend alignment.
Computed from metalscost.com's own stored price history.
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