India's power sector is facing a significant 30% shortage of Cold-Rolled Grain-Oriented (CRGO) steel, a crucial material for transformers and electric motors, according to the Global Trade Research Initiative (GTRI). CRGO steel's grain orientation helps reduce energy losses in transformer cores, making it indispensable for efficient power distribution. However, domestic production currently meets only about 10-12% of the total demand, compelling India to rely on imports from countries like Japan, South Korea, China, and Russia.
The shortage has been exacerbated by delayed license renewals from the Bureau of Indian Standards (BIS), which certifies foreign suppliers under a Quality Control Order. Many of these licenses are nearing expiration, causing supply uncertainty and limiting import options to approved vendors and grades.
Ajay Srivastava, founder of GTRI, emphasized the need for independent auditing of the BIS process to address delays. He also highlighted the importance of prioritizing local CRGO production as a strategic goal to secure India’s energy future. In FY 2024, India's demand for CRGO steel reached 400,000 tonnes, with domestic production at only 50,000 tonnes and imports filling much of the gap.
