In a landmark move to align India’s infrastructure growth with sustainability goals, the Ministry of Steel has proposed a mandate requiring the use of green-rated steel in all central government and centrally sponsored projects. As per reports, a cabinet note has already been drafted, outlining the framework and implementation timeline. The regulation, once approved, will come into effect from the fiscal year 2027–28 and remain applicable for a duration of eight years.
This initiative forms part of India’s broader push to decarbonise its hard-to-abate sectors, with the steel industry accounting for approximately 12 per cent of the country’s industrial emissions. The proposed mandate is expected to boost demand for low-emission steel and accelerate the transition toward environmentally friendly construction materials in government-backed infrastructure.
The Ministry’s draft suggests that only steel manufacturers adhering to specific sustainability benchmarks—including low carbon emissions during production, efficient resource utilization, and verified environmental impact assessments—will qualify to supply material for central projects. The plan also aligns with India’s long-term commitment under its Nationally Determined Contributions (NDCs) to reduce the emission intensity of its GDP by 45 per cent by 2030 compared to 2005 levels.
Industry experts note that this mandate could encourage Indian steelmakers to invest more aggressively in green steel technologies such as hydrogen-based direct reduced iron (DRI), renewable-powered electric arc furnaces (EAFs), and carbon capture systems. Leading players like Tata Steel, JSW, and AM/NS India have already begun piloting low-emission steelmaking processes.
Once implemented, the policy could position India as a global leader in sustainable steel production, setting a precedent for other developing economies to follow.
