A new policy that aims to achieve steel making capacity of 300 million tonnes by 2030 with an additional investment of Rs 10 lakh crore got the Cabinet green light on Wednesday.
The Cabinet also approved a policy for use of domestic steel products in government organisations.
"The Union Cabinet chaired by Prime Minister Narendra Modi has given its approval to the National Steel Policy (NSP) 2017," the steel ministry said in a statement.
"The Cabinet... has approved the policy for providing preference to domestically manufactured iron and steel products on government procurement," the ministry said in another statement.
The policy makes it mandatory to give preference to domestically manufactured iron and steel products (DMI&SP) in government procurement. The policy is applicable to all government tenders where price bid is yet to be opened.
"The DMI&SP policy provides a minimum value addition of 15 per cent in notified steel products which are covered under preferential procurement. In order to provide flexibility, the Ministry of Steel may review specified steel products and the minimum value addition criterion," it said.
The NSP enshrines a long-term vision to give impetus to the steel sector. It seeks to boost domestic steel consumption and ensure high quality steel production and create a technologically advanced and globally competitive steel industry.
The policy projects crude steel capacity of 300 mt, production of 255 mt and robust finished steel per capita consumption of 158 kg by 2030-31, as against the current use of 61 kg.
"The policy also envisages domestically meeting the entire demand of high-grade automotive steel, electrical steel, special steels and alloys for strategic applications and increasing domestic availability of washed coking coal so as to reduce import dependence on coking coal from about 85 per cent to around 65 per cent by 2030-31," the statement said.
Steel Minister Chaudhary Birender Singh is confident that the policy will give a concrete shape to future plans and policies for the steel industry in India.