April 7: The steel industry in India is facing significant operational challenges as geopolitical risks increasingly impact energy supply and production costs. Mr. Vijay Sharma, Chair of the Minerals & Metals Committee at PHD Chamber of Commerce and Industry (PHDCCI), highlighted that disruptions in LPG and propane supply, coupled with rising input costs, are putting pressure particularly on secondary steel producers.
In response, the government has prioritized measures such as gas allocation adjustments and improved coordination to stabilize supply. Simultaneously, steel manufacturers are exploring alternatives, including switching to piped natural gas (PNG) and diversifying fuel usage. However, challenges remain, including limited pipeline infrastructure, uneven access to PNG, high conversion costs, and delays in pipeline connections.
For open-source fuel plants, temporary use of alternative fuels like furnace oil, supported by faster environmental clearances, could offer short-term relief. Broader adoption of alternative fuels and cleaner energy solutions will require scaling infrastructure, streamlining regulations, and ensuring equitable access. Revamping the gas supply chain is essential for both operational stability and achieving carbon reduction goals.
Geopolitical uncertainties may also impact export competitiveness, making support measures—such as extending RoDTEP benefits to steel and stainless steel—critical for the sector. While the current situation is accelerating energy diversification and efficiency initiatives, Mr. Sharma emphasized that success will depend on coordinated policy, infrastructure readiness, and continued government support to maintain sector resilience and competitiveness.
