The industrial sector is on track to become India’s largest carbon emissions source by 2040, with the iron and steel sector being the country’s largest carbon-emitting industrial sector.
As the world’s second-largest producer of crude steel and a rapidly growing economy, India faces the challenge of meeting increasing steel demand while transitioning to less carbon-intensive production methods.
“For India to achieve its net-zero emissions target by 2070 and the world to meet the climate goals under the Paris Agreement, industries must shift to less carbon-intensive means of production and gradually align to net-zero/carbon-neutral pathways.”
This discussion paper provides a comprehensive framework and actionable recommendations for scaling transition finance to support the green industrial transition of India’s iron and steel sector, addressing both the needs of primary and secondary steel producers.
Why this matters?
10 – 12%
The iron and steel sector contributes 10-12% of India’s GHG emissions
120 Million
India produces 120 million tonnes of steel annually, contributing 2% to GDP
3x emissions
Without intervention, sectoral emissions could triple by 2050
Key recommendations include:
- Develop and implement a national sustainable finance taxonomy defining green and transitional activities
- Harmonise taxonomy with sectoral transition pathways while ensuring interoperability with other jurisdictions
- Mandate disclosure of corporate transition plans with standardised credibility assessment guidelines
- Design and implement green industrial policies for the iron and steel sector
- Develop sectoral transition pathways and technology roadmaps to transition to net-zero emissions
Explore the discussion paper
Discover deep insights and key recommendations on the transition finance mechanisms that can help guide the industry to a greener, more sustainable future.
The path forward, a strategic opportunity for green steel
The transition of India’s steel sector offers an economic opportunity. With strategic financing, policy support and industry commitment, India can become a global leader in low-carbon steel production while maintaining its competitive edge.
This discussion paper represents the beginning of a journey, not the destination. The recommendations outlined provide a framework for action, but success depends on collaborative efforts across financial institutions, policymakers, industry leaders and civil society.
By mobilising transition finance at scale, we can transform one of India’s most essential and emissions-intensive sectors into a cornerstone of its sustainable economic future.
About the India Green Steel Network
The India Green Steel Network (IGSN) is a member-driven, multi-stakeholder platform, comprising of 112 individuals across 54 organisations, including think tanks, business leaders, institutional investors, economists, technical experts, funders and civil society representatives.
The networks objective is to accelerate the transition to low-carbon steel by leveraging evidence-based research, partnerships and collaboration among domestic and international stakeholders.
The Sustainable Finance and Green Industrial Policy Working Group, led by Climate Policy Initiative and Climate Catalyst, develops evidence-based recommendations to accelerate the financing and policy frameworks needed for India’s steel sector transition.
