Finance Minister Nirmala Sitharaman is anticipated to present the Union Budget for the Financial Year 2026-27 in Parliament on February 1, 2025.
In its pre-Budget proposals for the domestic steel industry, the organization also recommended incentives for waste-heat recovery systems and the creation of renewable captive power plants to reduce emissions.
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The industry body emphasized that decarbonization is both a challenge and a competitive opportunity, asserting that these measures could expedite sustainable production.
Assocham further advocated for incentives aimed at enhancing scrap collection and recycling, stressing that bolstering domestic recycling infrastructure through skill development is crucial to lessen the country’s reliance on imports.
Highlighting existing challenges, Assocham noted that, despite being the second-largest steel producer globally after China with a robust growth rate of 8-9%, the sector is encountering significant obstacles.
Soaring input costs for essential raw materials, a declining rupee, and a heavy dependence on imported coking coal—due to limited domestic mineable reserves—remain pressing concerns.
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Moreover, the chamber mentioned that iron ore production has stagnated, with several auctioned mines yet to commence operations. Increasing steel demand alongside ongoing iron ore exports is exerting pressure on supply, leading to elevated costs for domestic mills.
Assocham believes the forthcoming Union Budget presents a crucial opportunity to establish India as a global manufacturing hub for steel and value-added products within the ’Make in India’ initiative.
To this end, the organization has requested the promotion of iron ore beneficiation, the removal of import duties on essential raw materials, and the rationalization of royalty calculations to eliminate double taxation.
It also stressed that incentivizing R&D in steel recycling, alloy development, and process digitization will boost productivity and decrease reliance on specialty steel imports.
