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India Steel Plan Needs Import Protection To Fund $400B Capex Says HSBC
M
Moneycontrol•16-10-2026, 11:21
India Steel Plan Needs Import Protection To Fund $400B Capex Says HSBC
- •India requires over $400 billion in steel ecosystem investments over the next two decades to hit its 2047 demand target of 505 million tonnes.
- •HSBC warns that financing this massive expansion will be difficult without continued import protection, citing cheap Chinese steel pricing pressures.
- •An 11% safeguard duty accounts for up to half of recent EBITDA for listed Indian steelmakers, making policy protection vital for cash generation.
- •The ambitious capacity push to 604 million tonnes by 2047 also demands heavy spending on mining, railway logistics, and decarbonization.
Key Questions Answered
The draft National Steel Policy Vision 2047 projects that India's steel demand will rise to 505 million tonnes by 2047, up from 164 million tonnes in FY26, representing a compound annual growth rate of 5.2%.
HSBC reports that an 11% safeguard duty accounts for 30-50% of recent EBITDA per tonne for listed Indian makers, and without import protection, the industry's annual cash profit pool would fall below $10 billion, hindering its $20 billion annual capex needs.
Meeting the 2047 demand target requires India's steel capacity to increase from 220 million tonnes in FY26 to 604 million tonnes by 2047, which involves adding 384 million tonnes of new capacity.
