Recognising limited availability of metallurgical coal as an 'disadvantage' for Indian steel sector, the draft steel policy aims at increasing supply of domestic coking coal to cut dependence on imports by half and a production of 300 million tonnes of the alloy by 2030-31.

"However, the Indian steel sector is disadvantaged due to limited availability of essential raw material ... Due to shortage of domestic coking coal, both in terms of quantity and quality, pig iron producers/ BF operators in India have to significantly depend on import of coking," the draft of 'National Steel Policy' released today said.

The National Steel Policy aims at achieving increased domestic availability of washed coking coal so as to reduce import dependence on coking coal by 50 percent by 2030-31.

The Steel Ministry has sought comments on the draft from stakeholders, public and others by January 23.

"The Ministry of Steel has prepared the draft policy named 'The National Steel Policy (NSP), 2017' to ensure that the steel sector follows a sustainable path of development in respect of augmenting capacity to 300 million tonnes (MT) by 2030-31 in environment friendly manner ... so that the country can, over time, reach the global efficiency benchmarks," the steel ministry said.

The proposed "National Steel Policy 2017 (NSP 2017) is an effort to steer the industry to achieve its future potential and strategy to deal with various impediments like high input cost, availability of raw materials, dependency on imports, financial stress etc," it added.

The draft policy aims at increasing per Capita Steel Consumption to 160 kg by 2030-31 and encouraging industry to be a world leader on energy and raw material efficient steel production by 2030-31, in a safe and sustainable manner.

The proposed policy aims to "develop and implement quality standards for domestic steel products," the ministry said.

In 2015, India was the only large economy in the world where steel demand continued to demonstrate positive growth at 5.3 percent, as against negative growth in China (-5.4 percent), and Japan (-7.0 percent).

India's growing urban infrastructure and manufacturing sectors indicate that demand is likely to remain robust in the years ahead.

Notwithstanding the current challenges, Indian steel industry still has significant potential for growth, underscored by the fact that the per capita steel consumption in the country at 61 kg is much lower than the global average of 208 kg.

The proposed policy aims at achieving increased per Capita Steel Consumption of 160 kg by 2030-31.

The crude steel production in 2015-16 stood at 89.77 million tonnes.

However, today the steel industry in India faces challenging external conditions manifest in slow economic growth and idle steel capacity globally.

With weak global economic prospects, the Indian steel industry will have to strongly depend on the growth of domestic consumption for its future.