Indian steelmakers are set to enter a multi-year investment cycle as the country targets expanding its steel-making capacity to 300 million tonnes by 2030, according to a report by S&P Global. The country's top four listed steel producers have announced a 40 per cent year-on-year increase in aggregate capital expenditure (capex) for fiscal 2027, representing an investment of ₹70,000 crore, which is up from ₹50,000 crore in fiscal 2026. As reported by S&P Global, this represents the start of a multi-year capex cycle as India aims to increase steel capacity to 300 million tonnes by 2030, with the top four producers accounting for half of the country's steel output.
The investment push is being driven by strong domestic demand, with India's finished steel consumption standing at 165 million tonnes in fiscal 2026. According to S&P Global, annual steel consumption is expected to increase by more than 50 million tonnes over the next five years. The capacity expansion is also being supported by trade protection measures, with the 11 per cent - 12 per cent duties on steel imports introduced provisionally in April 2025 and extended through April 2028 in early 2026, curbing cheaper imports and reducing competition from low-priced overseas supply. As noted by S&P Global, the capacity addition comes at a time when local producers face reduced competition from low-priced overseas supply, as safeguard duties continue to curb cheaper imports.
According to S&P Global, sector-wide earnings are rising in the Indian steel industry, supported by firm domestic steel prices and healthy demand. The report notes that while geopolitical conflicts may introduce second-order effects through higher freight and elevated energy costs, resilient steel prices should offset the impact on profit margins. Indian steel companies are well-positioned to absorb heavy capital outlays, with capital investments likely to stay elevated beyond fiscal 2027.
India aims to expand total steel capacity from 220 million tonnes to 300 million tonnes by 2030, which would entail an annual capital outlay of about USD 15 billion over the next five years. However, as noted by S&P Global, given the significant capacity additions, any prolonged weakness in domestic demand would be a key risk, with the resulting overcapacity potentially putting pressure on steel prices and earnings. The report was published on June 9, 2026.
