Will the Vehicle Recycling Policy Cut Down the Steel Scrap Import in India?

The Government of India has come up with the idea of proposing the Steel Recycling Policy with the view of reducing the dependency on steel scrap import and also to safeguard the environment.

Steel Scrap 100% Recyclable Material:

Steel Scrap is the completely recyclable material that is used without altering its property. It is the primary input to Electric Arc Furnace and the Induction Furnace for steel making. Steel Scrap recycling reduces the emission of CO2 into the atmosphere.  The recycled steel is much stronger and durable when compared to the new steel that is made from the iron ore.

Dependence on Steel Scrap:

As of March 2019, 1128 Electric Arc Furnaces & Induction Furnaces which are operating in India largely depend on steel scrap as a raw material for steel production.  The usage of one tonne of steel scrap in steel production can save up to 1.1 tonnes of iron ore, 630 kg of coking coal and 55 kg of limestone.

The Demand of Steel in India:

According to the report by the World Steel Association, the steel demand in India is expected to grow above 7% in the current as well as next year. Nearly, 30 million tonnes of steel scrap in India is required per year for steel production in which more than five million tonnes of steel scrap is imported from other countries. Automobile, construction and ship-breaking industries are the largest generators of steel scrap.

India the Second Largest Importer of Steel Scrap:

With the huge demand for steel, India emerged as the second largest importer of steel scrap in the world. Nearly, 35 percent of steel scrap import has been raised in the first half of 2019 to 3.87 million tonnes where 27 percent of steel scrap imported from the United Arab Emirates and 117 percent from the UK. The total value of the country's steel scrap imports was Rs 24,500 crore in 2017-18.
 
Circular Economy in Steel Sector:

To increase the usage of the internal steel scrap, the Indian government promotes a formal and scientific way of collecting, dismantling and processing of scrap. The Scrappage center will be established by the government all across the country to collect the scrap and thereby reducing the gap between the demand and supply of scrap in India.

Target of National Steel Policy:

The main motto of the National Steel policy is to develop India as the globally competitive steel industry by producing 300 MT of steel per annum. The current production of steel is nearly 100 million tons per annum. With the help of this Steel Scrap Recycling Policy, it is predicted that a high-quality and adequate amount of steel scrap for the steelmaking will be generated.

Necessity of Steel Scrap:

Currently, India is obtaining 25 Million Metric Ton from its domestic scrap industry and 7 Million MT from other countries. So, India has a deficit of about 7 Million Metric Ton of steel scrap. To compensate this the country requires 70 scrap processing centers each with a capacity of 1 lakh tonnes.

Policy to Formalize the Scrap Market:

The Scrappage Policy will be playing a major role in formalizing the scrap market and to make India self sufficient in scrap availability rather than importing the scrap from foreign land. This will also make India globally competitive in Steel Industry by adopting environment friendly technology.