Raw material availability will be the key challenge for the steel industry, according to the ‘Steel Outlook 2030-2047’ report prepared by Deloitte. The report was released on the second day of the ongoing ‘India Steel 2023’ conference organised by FICCI.
“In 2030, captive leases will expire, and we have to look at expediting new iron ore blocks and auctioning quickly,” Deloitte said in the report. It suggested more steel scraps recycling centres and policies to support exports.
As per the report, the steel industry will get a boost from government spending on infrastructure – almost 62% of steel goes into infrastructure construction – as it has announced almost ₹10 lakh crore of infrastructure spending in the current budget, which is about 3.3% of the GDP.
The PLI schemes are impacting various sectors and there is a trickle-down impact on the steel industry also.
The sector contributes approximately 2% to the Indian GDP and provides employment to over 2 million people.
According to the report, the 2030 vision as per National Steel Policy is 300 mt of crude steel capacity and the impact on the industry would come from strong push towards sustainability in terms of decarbonisation, circularity, energy transition, and carbon capture.
Also, the carbon border adjustment mechanism in the EU will have a carbon tax on imports from any country that is higher carbon dioxide per tonne of crude steel.
Today, in India it is about 2.5 tonnes of carbon dioxide per tonne of crude steel, whereas in the EU it is about 1.8 and the U.S. is lower.
“Clearly, there is going to be a challenge as discussion on green steel is happening,” according to the report.
In 2047, as per the report crude steel capacity would grow to 500 mt, and per capita consumption would to be about 220-225 kg.
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