Scrap shortage remains key hurdle for India’s green steel ambitions: Former Steel Secretary

India’s transition towards green steel production continues to face significant hurdles due to limited scrap availability and rising decarbonisation challenges, according to former Steel Secretary of India and Director at Jindal Steel & Power, Sanjay Kumar Singh.

Speaking at the PHDCCI National Conclave on Raw Material Securitisation for Metals and Minerals, Singh highlighted that only around 25 percent of the country’s steel demand is currently being met through scrap-based manufacturing. He said the shortage of steel scrap forces the industry to depend heavily on iron ore and blast furnace-based production methods, which generate higher carbon emissions.

India’s steel sector is currently witnessing strong growth, with crude steel production reaching nearly 168 to 169 million tonnes annually. Domestic steel consumption is also growing at around 8 to 9 percent every year, driven by rapid infrastructure development, urbanisation and industrial expansion across the country.

However, Singh warned that the quality of iron ore available in India is steadily declining. Lower-grade iron ore requires more energy during processing, resulting in increased carbon dioxide emissions and higher environmental costs for steelmakers.

He explained that while green steel production technologies are being explored through pilot projects, achieving completely emission-free steel manufacturing remains difficult under current conditions. According to him, significant emission reductions are only possible through the use of renewable energy, scrap-based manufacturing and electric arc furnace technology.

Singh also pointed to several government initiatives aimed at supporting the steel sector’s decarbonisation journey, including the National Green Hydrogen Mission and the proposed green steel mission. He stressed the growing importance of the Carbon Credit Trading System, which is expected to play a major role in reducing industrial emissions in the coming years.

The steel industry remains one of the most important sectors for India’s infrastructure and manufacturing growth. However, ensuring sustainable raw material availability and lowering carbon emissions will remain critical challenges for the sector in the long term.