India’s Ministry of Steel is in the final stages of framing a national steel scrap policy aimed at aligning the sector with evolving domestic industry dynamics and emerging global developments, a senior government official said on Wednesday, January 21.
Rising scrap demand amid capacity expansion
According to Daya Nidhan Pandey, joint secretary at the ministry of steel, scrap consumption in India’s steel sector has been steadily increasing, while overall scrap availability is projected to rise to nearly 36 million mt.
“This clearly indicates that demand for steel scrap will increase sharply as large-scale capacity expansion continues,” Pandey said, highlighting the growing role of scrap in India’s steelmaking landscape.
In a related development, the Indian Steel Association (ISA) has urged the government to introduce supportive policy measures in the national budget 2026-27 to encourage greater use of scrap in green steel production.
GST reform proposed across scrap supply chain
In its pre-budget memorandum submitted to the ministry of finance, the ISA called for the extension of the goods and services tax (GST) reverse charge mechanism across the entire metal scrap supply chain. The industry body said such a move would simplify tax compliance, curb leakages, and improve the overall ease of doing business.
Pandey added that India aims to gradually increase the share of scrap in steelmaking toward the global average of 31 percent.
“As the country moves toward 300 million mt of steel capacity by 2030 and 500 million mt by 2047, steel scrap will play a decisive role in conserving raw materials, reducing coal imports, lowering emissions, and supporting India’s commitment to achieve net-zero emissions by 2070,” he said.