Examine the cascading impact of rising raw material costs in the steel sector on downstream manufacturing industries such as automobiles and construction.

Domestic hot rolled coil (HRC) has touched ₹64,000/tonne and cold rolled coil (CRC) ₹75,000/tonne — a four-year high last seen in June 2022 [1]. As steel is a universal intermediate input, such input-cost shocks travel rapidly down the manufacturing chain.

Why steel costs are rising

• Coking coal dependence: India imports the bulk of its metallurgical coal because domestic coal is high-ash (mostly 18–49%) and unfit for direct blast-furnace use [2].
• Washing bottleneck: India produces over 51 MT of coking coal, yet steel plants' use of washed coal stays limited due to low washery output [3].
• Policy floor: the 12% safeguard duty on certain flat steel imports (April 2025) removes cheap import competition [4], so costs push up while imports cannot pull prices down.

Transmission to automobiles and appliances

• HRC and CRC are precisely the flat products used in auto body panels and white goods; CRC's steeper rise since August [1] hits value-added users hardest.
• Firms face a squeeze: raise vehicle prices and dampen demand, or absorb costs and compress margins — both slow the sector's employment-intensive growth.

Construction and infrastructure

• Costlier structural steel inflates project costs; fixed-price contracts turn into cost overruns and delayed execution.
• Public capex buys less per rupee, weakening the infrastructure-led growth push; housing affordability also erodes.

Asymmetric burden on MSMEs

• Small fabricators only buy steel — they lack long-term contracts, and the duty leaves no cheaper import to switch to [4]. The rise thus becomes a transfer from steel-using to steel-making industry.

The cascade is real but cyclical, driven by seasonal demand revival and import-linked input costs rather than permanent scarcity. The durable remedy is supply-side: expand beneficiation and washery capacity so domestic coal reaches furnaces usable [2], measure Mission Coking Coal's 140 MT by FY 2029-30 [5] by washed-coal delivered, and scale scrap-based electric arc furnaces. Reducing import dependence, rather than shielding prices, best serves Aatmanirbhar Bharat.