The Government of India is in advanced stages of developing a policy framework that will require public bodies to procure green‑rated steel, marking a significant shift toward sustainable procurement practices. A senior official from the Ministry of Steel confirmed that modalities for mandatory public procurement of green steel are being finalised. While the timeline remains tentative, the policy is expected to roll out in phases to align with infrastructure and civil works portfolios across central and public sector projects.
In parallel, the Ministry is finalising the ambitious Green Steel Mission, backed by an estimated ₹15,000 crore budget. This nation-wide initiative aims to catalyze the steel sector’s decarbonisation by offering a Production-Linked Incentive (PLI) scheme, renewable energy subsidies, and encouraging steelmakers to shift toward low-emission production technologies like hydrogen-based DRI and electric arc furnaces.
As currently envisioned, the procurement mandate could start with a minimum share of green steel in public projects, gradually increasing to 25 per cent of total steel demand in government-led construction and infrastructure by mid-decade. This demand‑side policy is designed to bridge the cost difference between green and conventional steel and stimulate private-sector investment in low-carbon facilities.
Industry stakeholders and analysts view the move as a pivotal step: public demand can de-risk early adoption, create scale for green projects, and ensure India’s steel sector aligns with global climate commitments under its 2050 net‑zero goal. The integration with the National Green Hydrogen Mission further reinforces cross-sector coordination to develop the clean energy needed for hydrogen-based steel production.
Overall, the proposed mandate and the accompanying Green Steel Mission represent a comprehensive policy push—linking regulatory demand, financial incentives, and sustainability targets. Driven by government procurement and backed by capital support, this dual approach is expected to mark a turning point in India’s transition toward greener steelmaking.
