India closes in on Japan as second-largest steel producing country

India's crude steel production grew by 7.4 per cent in 2016 as it closed in on Japan as the second largest steel producing country in the world. India is tipped to overtake Japan by 2020. The country's production during the year stood at 95.6 million tonnes per annum while Japan registered a 0.3 per cent decline at 104.8 mt. China remains by far the largest steel producer in the world at 808.4 mt, up 1.2 per cent over 2015.

According to figures released by worldsteel.org, worldwide crude steel production reached 1,628.5 million tonnes (Mt) in 2016, marginally up by 0.8 per cent compared to 2015. Production decreased in Europe, the Americas and Africa but was more than offset by increases in the CIS, the Middle East, Asia and Oceania.

India retained its position as the fastest growing major steel economy during the year. Japan, United States, Russia, Brazil, Germany and South Korea all registered declines during the year. Besides India and China, Turkey and Ukraine were the only countries to register a growth in the list of top 10 steel producing countries.

In the last few years, India has provided the only silver lining. While other markets have either stagnated or declined, consumption of steel in India has grown continuously at a steady pace.

In 2016, production was boosted by new capacities coming on stream from government owned Steel Authority of India Ltd and Tata Steel. The latter began trial production at its Kalinganagar factory in 2016, its first new factory in over a century.

"We have started taking steps to boost the country's steel production. Rs 62,000 crore will be spent to enhance the production capacity of steel manufacturing plants," says Steel minister Birender Singh. "India is at present the third largest steel producer in the world. We are taking steps so that it can grab the second spot in the next two-three years."

The government has come up with a new National Steel Policy 2017 that envisages increasing the capacity in the country more than 2 fold from 122 million tonnes per annum (mtpa) to 300 mtpa by 2030. It would require an investment of close to Rs 10 lakh crore.