India is the world’s second-largest producer of steel, but its per capita consumption of steel is much lower than other countries. This article will look into the reasons behind India’s low per capita steel consumption.
Low Per Capita Steel Consumption in India
India has the second highest steel production in the world, with an output of 101.4 million tonnes in 2018-19. However, its per capita steel consumption is only 65 kg, compared to the world average of 208 kg and the highest being South Korea at 744 kg.
Reasons Behind Low Steel Consumption in India
There are several reasons behind India’s low per capita steel consumption.
First, India’s population is over 1.3 billion, and the majority of the population lives in rural areas and is not exposed to modern steel products. As a result, steel consumption in India is mainly concentrated in urban areas, resulting in a low per capita consumption.
Second, the Indian steel industry is highly fragmented, with numerous small-scale producers. This makes it difficult for them to compete with larger producers on price, resulting in higher steel prices.
Third, India’s infrastructure is not well-developed, which limits the use of steel products. This further reduces the demand for steel in India.
Fourth, India’s steel industry is highly import-dependent, and the country’s steel imports have been rising steadily over the years. This has resulted in a further decrease in the domestic demand for steel.
Finally, India’s steel industry has been facing several regulatory challenges, which has further reduced the demand for steel in the country.
In conclusion, India’s low per capita steel consumption is due to a variety of factors, including a large population, a highly fragmented steel industry, weak infrastructure, high import dependence, and regulatory challenges. With the right policies and investments, India can increase its per capita steel consumption and become an even bigger player in the global steel market.