India seeks $1.74b for green steel incentives

India’s steel ministry has requested 150 billion rupees ($1.74 billion) from the budget to provide incentives to mills for producing low-carbon steel, two government sources familiar with the situation informed Reuters.

Finance Minister Nirmala Sitharaman will present the federal budget for the 2025-26 fiscal year on Feb. 1.

India, the world’s second-largest steel producer, is developing a green steel policy to reduce carbon emissions in line with Prime Minister Narendra Modi’s 2070 net-zero target.

The steel ministry is considering offering incentives to reduce emissions, boost research and development, increase raw material efficiency, and encourage banks to provide lower interest rates on renewable energy loans, the anonymous sources said.

The ministry did not respond to Reuters request for comment via email.

Last month, the government classified steel with carbon dioxide emissions below 2.2 metric tons per ton of finished steel as ‘green’.

These incentives will be available until 2030, with India also exploring the use of green steel in government projects.

Indian steel producers emit 2.55 metric tons of carbon dioxide per ton of crude steel, 38 per cent more than the global average of 1.85 tons, as per Global Energy Monitor.

Attribution: Reuters

Subediting: M. S. Salama