In a significant shift, India has transitioned from being a net exporter of steel to a net importer in fiscal 2024, according to a report by CRISIL. This change is driven by surging domestic demand and increased imports from major steel-producing nations. India’s imports of finished steel reached 8.3 million tonnes (MT) in fiscal 2024, a substantial 38 percent increase year-on-year. China, South Korea, Japan, and Vietnam were among the primary contributors to this surge in imports, with Chinese steel imports alone accounting for 2.7 MT. Imports from Vietnam saw a staggering 130 percent increase, positioning it as a significant steel exporter to India.
Despite a growth of 11.5 percent in exports of finished steel, totaling approximately 7.5 MT in fiscal 2024, the increase was not enough to offset the growing volume of imports. The European Union (EU) remains India’s largest export market for steel, with exports to the EU increasing by 51 percent in fiscal 2024. The recovery in exports to the EU came after a challenging first half of the fiscal year. However, the competitive pressures from Chinese steel in the global market have significantly impacted India’s export potential. China’s aggressive export strategy, driven by overcapacity, has put pressure on Indian exports and affected their competitiveness.
Despite challenges on the export front, the Indian steel industry has been supported by strong domestic demand. India’s steel consumption grew by 13.6 percent in fiscal 2024, reaching 136 MT. This growth is indicative of the country’s ongoing infrastructure expansion and development in related sectors. Finished steel production in India also increased by 12.7 percent year-on-year, reaching 139 MT. Favorable government policies and investments in steel production capacities have supported this growth, ensuring a steady supply of steel to meet the rising domestic demand.
The transition from a net exporter to a net importer of steel presents both challenges and opportunities for India. Managing the influx of cheaper imported steel while strengthening domestic production and maintaining export competitiveness will require strategic adjustments. Policymakers and industry stakeholders will need to navigate these dynamics to sustain growth and strengthen India’s position in the global steel market. The vibrant development in related sectors and ongoing infrastructure expansion in the country serve as positive indicators for the steel industry, supporting robust economic activities and steel consumption.
