Steel Industry in India - Emerging Tech Trends, Use Cases & Future Prospects

Having completed her BS in Finance & Financial Management Services from Babson College and Executive Education from INSEAD, Kairavi has been associated with VKICL for over nine years now and was instrumental in transforming the company’s traditional business model from being a wholesaler to a customer centric model. In a recent conversation with Siliconindia, Kairavi Mehta, CEO & Executive Director, V. K. Industrial Corporation (VKICL) shared her thoughts on the current steel industry in India and various other aspects surrounding the sector. Below are the key extracts from the exclusive interview

How do you see the steel products industry in India today?

Currently, the steel products industry in India is undeniably robust and promising. In the midst of global challenges such as inflation, recession concerns, and energy crises, the Indian steel industry has shone brightly. As the second-largest global producer of crude steel with an impressive output of 10.14 million tons, India’s steel sector is on an upward trajectory. The World Steel Association’s projection of 6.1 percent growth in 2022 and 6.7 percent in 2023 further underscores this positive trend. Over the past decade, the industry has witnessed significant expansion, along with a notable increase in production capacity. Looking ahead, the demand for steel in India remains strong. With an estimated 7.5 percent annual growth rate, domestic steel demand is expected to reach 128.85 million tons in the current fiscal year. Projections from the Indian Steel Association indicate that the demand is poised to continue its ascent, reaching 136.97 million tons in the next fiscal year 2024-25.

What are some of the key areas that are showcasing widespread adoption of steel in the manufacturing sector?

Steel continues to evolve and find new applications in various areas of manufacturing. In the real estate industry, we are witnessing a shift towards the use of steel beams and channels to create more sustainable and cost-effective building solutions. While this practice has been prevalent in the West for years, it is still at a nascent stage in India, offering tremendous potential for growth and innovation. By adopting these steel-based solutions, we can not only construct durable structures, but also contribute to environmental sustainability. On the other hand, the surge in demand for automation technologies such as AI and robotics necessitates the development of new grades of steel tailored to meet the specific needs of these advanced machines. As a result, we can expect the emergence of innovative steel alloys designed to enhance the performance, durability, and precision of robotic systems, further propelling automation in manufacturing processes.

Similarly, India’s defence manufacturing sector too is currently poised for significant growth, aligning with the Government of India’s ‘AtmaNirbhar’ (self-reliance) initiative. This growth trajectory is expected to generate demand for a wide range of steel grades that were not previously required in the Indian market. From specialized armour plating to high-strength structural components, steel will play a crucial role in bolstering India’s defence capabilities and fostering domestic production.

Throw some light on the latest tech advancements in steel products manufacturing.

While steel is an integral part of our lives, it is important to recognize that traditional steel manufacturing methods contribute significantly to global carbon emissions. Approximately 75 percent of the world’s steel is produced through the blast furnace route, a process known for its high levels of CO₂ emissions and energy consumption. However, in response to the growing global emphasis on sustainability and the pursuit of net-zero emissions, there have been remarkable advancements in steel manufacturing technology.

Another noteworthy innovation in this sector is the widespread adoption of Hydrogen Direct Reduction (H-DR) technology by leading steel manufacturers around the world. This revolutionary approach aims to reduce carbon emissions and minimize the release of harmful greenhouse gases by using hydrogen produced through renewable energy sources to create direct reduced iron (DRI). The DRI is then introduced into an Electric Arc Furnace where electrodes generate a current to melt the DRI and transform it into steel. This transition to H-DR technology represents a pivotal shift toward ‘Green Steel’ production, aligning with the global commitment to environmentally friendly practices. By harnessing renewable energy sources and hydrogen, steel manufacturers are not only reducing their carbon footprint, but also contributing to a more sustainable future for the steel industry.

Briefly explain the impact of steel towards the overall growth of our nation.

A good infrastructure forms the backbone of every country that aspires to develop rapidly.  Since a nation’s growth potential remains limited without progressive infrastructure, the present Government is making substantial investments in infrastructure development to attract significant FDI and move closer to achieving its goal of becoming the world’s third largest economy by 2027-28. Notably, steel stands-out as one of the most essential components in this ambitious infrastructure development endeavour by our government.

How do you expect the Indian steel industry to evolve in the near future?

Being the most preferred choice for many applications due to its recyclable nature, the future for steel in India looks promising and sustainable. However, what lies ahead is the emergence of green and sustainable steel, which will further solidify steel as the No.1 choice of material for all major uses. With a growing emphasis on environmental responsibility and sustainability, the steel industry is poised to play a pivotal role in meeting these demands. As India continues to invest in eco-friendly steel production methods, we can expect to see a rise in the adoption of steel across various sectors. This trend not only aligns with global sustainability goals, but also ensures that steel remains at the forefront of materials for the foreseeable future in India.