India should increase use of steel scrap for sustainable growth: Official

Jaipur, Jan 20 (PTI) India needs to significantly increase the use of steel scrap in its production processes to support sustainable growth, reduce emissions and meet future capacity targets, a senior government official said on Tuesday.

Addressing the 13th International Material Recycling Conference and Exposition (IMRC 2026), Joint Secretary in Ministry of Steel Daya Nidhan Pandey said India, the world's second-largest crude steel producer, has recorded 11.7 per cent growth in finished steel consumption over the last four years.

"It is essential for India to progressively increase the share of steel scrap in its charge mix with an aim to achieve the global average of 31 per cent to foster sustainable steel industry," he said at the conference organised by the Material Recycling Association of India (MRAI).

"This shift is important for achieving long-term energy efficiencies, supporting resource security and reducing the overall environmental footprint of the steel sector," he said.

Pandey said that India's scrap ecosystem today is still at an early stage of maturity and will require time to reach the global average.

He said that as successive waves of infrastructure, vehicles, and industrial assets reach end-of-life, scrap generation in India will increase steadily.

"In this context, ship breaking, end-of-life vehicles and construction and demolition waste are expected to emerge as major and reliable sources of industrial-grade scrap in the coming years," he said.

The joint secretary said that bridging this gap requires a concerted approach across the steel ecosystem, encompassing both government and industry.

"Stronger supply-side measures are essential, including stricter enforcement of ELV deregistration, mandatory compliance for construction and demolition waste recovery, and the modernization of shipbreaking facilities." In parallel, he said, demand-side policies must create assured and cost-competitive markets for scrap, enabling steel producers to adopt scrap at scale and with confidence.

"Steel scrap recycling and intelligent charge mix design are central to building a modern, resilient, and globally competitive steel sector. By placing scrap at the core of our strategy, Indian steel will be strong in capability, circular in resource use, and clean in its environmental footprint," he said.

"As India advances toward its 300 MT by 2030 and 500 MT by 2047 steel capacity targets, steel scrap is expected to play a decisive role in sustainable steel production," Pandey added.

He informed that the steel sector contributes about 2 per cent to India's GDP, and the government has set a target of creating 300 million tonnes (MT) of crude steel capacity by 2030-31 under the National Steel Policy 2017.

India's crude steel production stood at 144.3 MT in 2023-24. Currently, scrap accounts for about 21 per cent of crude steel production in the country, Pandey said.

He noted that scrap usage varies across production routes, with around 9 per cent in blast furnace-basic oxygen furnace operations, 39 per cent in electric induction furnaces and 13 per cent in electric arc furnaces.

Highlighting environmental benefits, Pandey said steel recycling supports a circular economy and helps reduce emissions, as every tonne of recycled scrap avoids about 1.5 tonnes of carbon dioxide emissions and saves iron ore and coal inputs.

MRAI President Sanjay Mehta said that recycling in India is no longer a peripheral activity and is central to resource security, climate commitments and manufacturing competitiveness.

Dhawal Shah, Senior Vice President of MRAI said that from GST compliance to scrap import policies, the Indian recyclers today face operational friction that directly impacts costs and global competitiveness.

Various key issues including sustainability, climate change, energy storage and circular economy transitions are set to be discussed in the two-day conference. PTI AG ANU ANU