India’s ambitious plan to scale up steel production capacity to 300 million tonnes (MT) by 2030 under the National Steel Policy is set to intensify its dependence on coking coal, even as the country pushes for energy transition and net-zero commitments. A joint report by EY Parthenon and the Indian Steel Association (ISA) warns that demand for coking coal will jump from 87 MT in FY25 to 135 MT by FY30 driven largely by infrastructure, construction, and automotive growth.
While the government’s Mission Coking Coal aims to more than double domestic raw coal production to 140 MT by 2030, India’s steel sector will remain heavily import-dependent, sourcing nearly 80% of its coking coal requirements from countries such as Australia, the US, Canada, and Russia. New sourcing corridors from Mongolia and Mozambique are being explored, but imports will continue to play a defining role in the country’s industrial growth.
Environmental Dilemma: Growth vs. Emissions
The steel industry, which consumes 95% of India’s coking coal, is also one of the largest carbon emitters. Globally, steel contributes 7–8% of greenhouse gas emissions, while in India, the figure is closer to 12%, making it a critical sector in the climate debate. With India committed to achieving net-zero by 2070, the rising reliance on fossil fuel-based steel production raises significant challenges.
Decarbonization pathways outlined in the report suggest coal-based steel production will decline from 89% in 2030 to just 29% by 2050, with green hydrogen-based direct reduced iron (DRI), scrap-based electric arc furnaces (EAF), and carbon capture, utilization, and storage (CCUS) technologies leading the transition. However, the pace of these clean technology adoptions remains uncertain given the high costs and infrastructure gaps.
Renewable Energy and Steel’s Future Reliability
India’s steel ambitions are intertwined with its renewable targets. To ensure global competitiveness and environmental compliance, the sector must integrate renewable electricity, hydrogen, and circular economy practices. Experts highlight that while fossil fuels will remain dominant in the short term, reliable renewable energy infrastructure is essential to power low-carbon steelmaking at scale.
Vinayak Vipul, Partner, EY Parthenon, emphasized:
“India’s steel ambitions cannot be realized without addressing its heavy reliance on imported coking coal. The way ahead is clear—India must accelerate beneficiation, diversify sourcing, and invest in low-carbon technologies to build resilience and sustainability.”
Balancing Security, Affordability, and Sustainability
Heavy reliance on imported coking coal also exposes India to price volatility, geopolitical risks, and supply chain shocks. Industry leaders are calling for a transparent India-centric pricing index, creation of strategic coal stockpiles, and public-private investments in overseas mining equity to secure long-term supplies.
Naveen Jindal, President of the Indian Steel Association, stated:
“Coking coal remains the backbone of steelmaking, and securing reliable supply is a strategic necessity for national growth. With stronger resource security and clear policy support, India can build a globally competitive and sustainable steel sector.”
India faces a dual challenge: meeting surging steel demand for economic growth while simultaneously cutting carbon intensity to align with climate commitments. A cohesive industry-government partnership that expands beneficiation capacity, accelerates clean technology adoption, and ensures renewable energy reliability will be critical.
If India succeeds in balancing these competing goals, its steel sector could become not just the backbone of industrial growth but also a benchmark for sustainable heavy industry in the global energy transition.