India targets 25% cut in steel sector emissions by 2035 under new policy push

India is preparing a major policy push to reshape its steel industry with a strong focus on sustainability, capacity expansion and global competitiveness. Under the proposed National Steel Policy 2025, the country aims to reduce carbon emissions from steel mills by nearly 25 per cent over the next decade, while simultaneously increasing crude steel production capacity to 400 million tonnes by 2035–36.

According to the proposed roadmap, emissions from steel production are targeted to come down to 2 metric tonnes of carbon dioxide per tonne of finished steel by 2035–36, compared to the current average of around 2.65 tonnes. This is a significant move as the steel sector currently contributes nearly 10 to 12 per cent of India’s total carbon emissions.

The policy comes at a crucial time when global markets are increasingly focusing on low-carbon manufacturing. With the European Union’s carbon border measures already impacting exports of high-emission products such as steel and cement, India’s move is expected to improve its competitiveness in international markets and open new export opportunities.

At the same time, India is looking at an aggressive expansion of steel capacity, driven by rising infrastructure spending, industrial growth and domestic demand. The country currently produces around 168 million tonnes of crude steel and plans to more than double this to 400 million tonnes by 2035–36.

The policy also proposes reducing dependence on imported coking coal, one of the key raw materials for steel production, from nearly 90 per cent at present to 80 per cent over the same period. Increased use of steel scrap, gas-based steelmaking and cleaner technologies are expected to play a major role in this transition.

Industry experts believe this strategy could attract investments of nearly ₹17 lakh crore and generate over 30 lakh jobs across the steel value chain, making it one of the most significant policy shifts for India’s industrial sector in recent years.