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India must significantly ramp up its steel production capacity to meet growing domestic demand, but new projects must be financially viable, according to Tata Steel's leadership. Speaking after the company reported over 116% growth in consolidated net profit for Q1 FY 2025–26, top executives emphasized the need for strategic and sustainable expansion.
India currently has a steelmaking capacity of approximately 200 million tonnes and aims to scale it up to 300 million tonnes by 2030 and 400 million tonnes by 2035. However, Tata Steel warned that indiscriminate capacity additions without profitability could strain industry finances. Projects must generate operating margins of at least 15–20% to support further growth.
The company also flagged concerns over rising imports from China, which are putting pressure on domestic pricing and margins. Despite the robust demand outlook, such competitive imports may delay or discourage fresh investments in the sector.
Tata Steel highlighted its continued investments in advanced, low-carbon steelmaking technologies such as hydrogen-based DRI and HIsarna, aligning with global sustainability goals. The company also expects its UK operations to break even by FY 2026.
Overall, while India’s steel growth trajectory remains strong, Tata Steel has underlined the importance of a balanced approach—focused on profitability, strategic trade policies, and green transition—to ensure long-term competitiveness.
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