India Electrical Steel Market, By Type (Grain Oriented Electrical Steel, Non-Grain Oriented Electrical Steel), By Application (Transformers, Motors & Generators, Inductors), By Vertical (Automotive, Construction, Manufacturing, Energy & Power, Others) By Region, Competition, Forecast & Opportunities, 2021-2031F

Market Overview

India Electrical Steel Market was valued at USD 2.25 billion in 2025 and is expected to reach USD 3.83 billion by 2031 with a CAGR of 9.10% during the forecast period.  

Electrical steel, also known as silicon steel or transformer steel, is a specialized type of steel designed specifically for use in electrical applications, particularly in the cores of transformers, motors, and generators. Its primary purpose is to efficiently conduct magnetic flux with minimal energy loss, which is crucial for enhancing the performance and efficiency of electrical devices.

This steel is alloyed mainly with silicon, typically ranging from 1% to 3.5%, which significantly improves its electrical resistivity and reduces hysteresis and eddy current losses. These losses occur when the magnetic field in the steel core continuously reverses direction during operation, causing energy dissipation in the form of heat. By minimizing these losses, electrical steel helps in improving energy efficiency and reducing heat generation.

Electrical steel is produced in two main types: grain-oriented and non-grain-oriented. Grain-oriented electrical steel has a specific crystalline structure that aligns with the magnetic field, optimizing magnetic properties along one direction, making it ideal for transformers. Non-grain-oriented steel has uniform magnetic properties in all directions, suitable for rotating machines like motors.

Key Market Drivers

Rapid Growth in Renewable Energy Sector

India’s accelerating renewable energy buildout is a major demand driver for electrical steel because wind turbines, solar-linked substations, evacuation infrastructure, and grid balancing systems all depend on transformers, generators, and rotating equipment that require high magnetic efficiency and low core loss. The policy signal is strong and long term, with the Government of India reiterating the goal of achieving 500 GW of non-fossil fuel capacity by 2030, while the National Electricity Plan Transmission was launched to support transmission of 500 GW of renewable energy by 2030 and more than 600 GW by 2032. 

That matters directly for electrical steel demand because every large renewable addition must be matched by new transformation and transmission capacity, and the same transmission plan outlines around 190,000 circuit kilometres of transmission lines and 1,270 GVA of transformation capacity over the next decade to integrate renewable generation more effectively into the grid. As renewable projects spread into high-resource but remote zones, utilities and equipment suppliers need better-performing transformers and generators that can reduce losses, improve reliability, and handle variable operating conditions more efficiently than conventional equipment.

For instance, the National Electricity Plan Transmission also incorporates 47 GW of battery energy storage systems and 30 GW of pumped storage hydropower while planning for green hydrogen and green ammonia hubs, which shows that India’s clean energy transition is not just adding generation assets but building a much broader electricity ecosystem that naturally increases the need for advanced electrical steel in generators, transformers, motors, and grid-support equipment.  

Expansion of Electrical and Electronics Manufacturing Industry

The expansion of India’s electrical and electronics manufacturing ecosystem is another major driver for electrical steel because products such as motors, transformers, compressors, fans, air conditioners, refrigerators, washing machines, switchgear, and industrial automation systems all require efficient magnetic cores to improve performance and reduce power losses.

The scale of industrial growth is already substantial, with the government stating in December 2025 that India’s electronics production had risen from Rs 1.9 lakh crore in 2014 to 2015 to Rs 11.32 lakh crore in 2024 to 2025, while exports rose from Rs 38,000 crore to Rs 3.27 lakh crore over the same period, indicating a much larger domestic manufacturing base that will continue to consume electrical steel across multiple end uses.

Large Indian manufacturers are also deepening their own capacity and product portfolios in ways that directly reinforce this trend, as Havells’ FY25 integrated report highlights business lines spanning motors, consumer durables, Lloyd air conditioners, refrigerators, washing machines, and solar products, all of which are highly relevant to non-grain-oriented electrical steel demand. The industrial equipment side is strengthening as well, with CG Power reporting FY25 order intake of Rs 14,684 crore and annual sales growth across its power and industrial systems businesses, reflecting healthy demand for transformers, motors, and related electrical machinery where efficiency-oriented steel is essential.

For instance, CG Power said it had approved a greenfield expansion for an additional 45,000 MVA of power transformer capacity with an investment of Rs 712 crore targeted for completion by FY28, a clear signal that India’s manufacturing push is steadily enlarging the installed and under-construction base of electrical equipment that depends on high-quality electrical steel.

Infrastructure Development and Urbanization

Infrastructure development and urbanization are also creating strong demand for electrical steel in India because expanding cities, industrial corridors, metros, airports, smart infrastructure, and power distribution upgrades all need large numbers of transformers, motors, HVAC systems, escalators, pumps, and other electrically driven systems that operate more efficiently when built with better magnetic materials.

The underlying urban pressure is significant, with the Prime Minister stating in March 2025 that India’s urban population is expected to reach around 900 million by 2047, which implies sustained additions in urban utilities, transit systems, commercial buildings, and public infrastructure for years ahead. Government-backed city modernization is already translating into real projects, and in August 2025 the government said that 7,336 Smart Cities Mission projects worth more than Rs 1.53 lakh crore had been completed, while all 100 smart cities had Integrated Command and Control Centres, showing that the infrastructure pipeline is large, technologically oriented, and increasingly power intensive. This environment naturally lifts electrical steel usage because smarter and denser infrastructure needs more efficient transformers and motors to reduce losses and improve reliability as electricity demand rises in transport systems, residential clusters, and public facilities.

For instance, Larsen and Toubro reported that its Infrastructure Projects segment secured orders worth Rs 1,73,226 crore in FY25, a scale that highlights how rapidly India is building urban and transport infrastructure and why demand for electrical steel continues to strengthen alongside the growing requirement for efficient electrical equipment embedded across these projects.  

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Key Market Challenges

High Production Costs and Import Dependence

The India electrical steel market faces significant cost-related challenges, largely due to its dependence on imported raw materials such as silicon and specialized alloys. Limited domestic availability makes the supply chain vulnerable to global price fluctuations, currency volatility, and geopolitical risks, leading to unpredictable input costs. Additionally, electrical steel production is capital-intensive and technologically complex, particularly for grain-oriented steel used in transformers, which requires advanced processing techniques.

High energy costs in India further increase production expenses, reducing competitiveness against imports from countries like China and Japan, where manufacturing costs are lower. Limited adoption of advanced technologies and automation also restricts productivity and efficiency among domestic producers. As a result, downstream industries such as transformer and motor manufacturers often rely on imported electrical steel, constraining the growth of local producers. Addressing these issues will require investment in technology, improved energy efficiency, and development of domestic raw material sources.

Quality Standards and Technological Gaps

Maintaining consistent quality remains another major challenge for the Indian electrical steel industry. Electrical steel must meet strict magnetic and physical performance standards, and even minor inconsistencies can lead to energy losses, overheating, and reduced equipment lifespan. However, many domestic manufacturers lack access to advanced technologies such as precision cold rolling mills, annealing furnaces, and modern coating systems needed to achieve these standards.

Inconsistent quality control practices across the industry further impact product reliability, sometimes leading to compromises in material composition or coating quality. Limited investment in research and development also restricts innovation and the ability to produce advanced grades required for emerging applications like electric vehicles, renewable energy systems, and smart grids. Additionally, a shortage of skilled professionals in metallurgy and process engineering contributes to these challenges, making it difficult to achieve global benchmarks.

Path Forward: Technology, Quality, and Self-Reliance

To overcome these challenges, the Indian electrical steel sector must focus on technological advancement, stricter quality enforcement, and capacity building. Investments in modern manufacturing infrastructure, automation, and R&D will be essential to improve product quality and operational efficiency. Strengthening skill development initiatives and fostering collaboration with global technology providers and academic institutions can help bridge knowledge gaps.

At the same time, promoting domestic production of key raw materials and improving supply chain infrastructure can reduce import dependence and enhance cost competitiveness. A coordinated approach involving industry stakeholders and government support will be crucial to building a resilient, high-quality, and globally competitive electrical steel market in India.

Key Market Trends

Rising Adoption of Grain-Oriented Electrical Steel (GOES)

A key trend in the India electrical steel market is the growing adoption of grain-oriented electrical steel (GOES), driven by the need for energy-efficient transformers and power infrastructure. GOES offers superior magnetic permeability and lower core losses, making it ideal for minimizing energy wastage in transmission and distribution systems.

With rising electricity demand and increasing integration of renewable energy, India’s power sector is prioritizing efficiency and grid reliability. Government regulations aimed at reducing transmission losses are further accelerating the shift toward GOES. Utilities and manufacturers are recognizing the long-term benefits of improved performance, lower operational costs, and enhanced equipment lifespan.

Although domestic production is gradually increasing, imports still dominate due to the complex manufacturing process and higher production costs. However, ongoing investments in local manufacturing capabilities and technological collaborations are helping bridge this gap. Additionally, GOES is finding new applications in areas such as smart grids and EV charging infrastructure, reinforcing its importance in building a more sustainable and efficient energy ecosystem.

Growing Demand for Non-Grain-Oriented Electrical Steel (NGOES)

Another major trend is the rising demand for non-grain-oriented electrical steel (NGOES), particularly in motor-driven applications. Unlike GOES, NGOES provides uniform magnetic properties in all directions, making it suitable for rotating equipment such as motors and generators.

India’s rapid industrialization and urbanization are significantly increasing the use of electric motors across sectors including manufacturing, agriculture, HVAC systems, and consumer appliances. Government initiatives promoting industrial electrification and energy-efficient motors are further boosting demand for high-quality NGOES.

The emerging electric vehicle (EV) market is also contributing to this growth. EV motors require advanced electrical steel with superior magnetic and mechanical properties to ensure efficiency and durability. As EV adoption gains momentum, demand for specialized NGOES grades is expected to rise. At the same time, stricter energy efficiency regulations are pushing manufacturers to upgrade material quality and production processes.

Shift Toward Advanced and Specialized Electrical Steel

The combined rise of GOES and NGOES reflects a broader shift toward advanced, high-performance electrical steel in India. Manufacturers are increasingly investing in improved coating technologies, precision processing, and advanced annealing techniques to enhance product quality and efficiency.

This trend is closely aligned with the country’s push toward energy efficiency, electrification, and sustainable development. As industries evolve and new applications emerge, the demand for specialized electrical steel solutions will continue to grow. Companies that focus on innovation, quality enhancement, and capacity expansion will be better positioned to capitalize on these opportunities and support India’s transition toward a more efficient and resilient energy infrastructure..

Segmental Insights

Type Insights 

Non-Grain Oriented Electrical Steel (NGOES) held the largest share of the India electrical steel market in 2025, primarily due to its versatility and widespread applications. Unlike Grain Oriented Electrical Steel (GOES), which is mainly used in transformers, NGOES is essential for rotating machines such as motors, generators, compressors, and various household appliances. These applications are far more numerous across industrial, commercial, and residential sectors, driving its higher consumption.

India’s rapid industrialization, urbanization, and rising demand for consumer appliances like air conditioners, refrigerators, washing machines, and fans significantly contribute to NGOES demand. Additionally, the expanding automotive sector—especially electric vehicles (EVs)—is accelerating its usage, as EV motors require high-quality electrical steel for optimal efficiency. NGOES is also relatively easier and more cost-effective to produce compared to GOES, making it more suitable for large-scale domestic manufacturing. Government initiatives promoting energy-efficient motors further support the growth of this segment.

Application Insights 

Motors and generators accounted for the largest share of the India electrical steel market in 2025, driven by their extensive use across multiple sectors. These machines are fundamental to industrial operations, infrastructure development, and everyday household applications. NGOES, with its uniform magnetic properties in all directions, is particularly well-suited for these rotating systems, making it the backbone of demand in this segment.

The increasing use of electric motors in industries such as manufacturing, construction, agriculture, HVAC, and transportation is a major growth driver. Applications range from industrial machinery and conveyor systems to agricultural pumps and air conditioning units. At the same time, rising disposable incomes and urbanization are boosting demand for motor-driven consumer appliances, further increasing electrical steel consumption.

The shift toward electric vehicles (EVs) and automation is another critical factor. EV motors require highly efficient electrical steel to reduce energy loss and improve performance, while renewable energy systems such as wind and hydro power rely heavily on generators. These trends are expected to sustain strong demand for motors and generators, reinforcing their dominant position in the market.

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Regional Insights

South India held the largest market share in 2025. South India holds a dominant position in the Indian electrical steel market due to a combination of industrial concentration, infrastructure development, and favorable economic policies. The region is home to several major manufacturing hubs, particularly in Tamil Nadu, Karnataka, and Telangana, which host a dense network of industries producing electrical equipment, appliances, transformers, and motors — all of which require electrical steel as a core component.

One of the key reasons for this dominance is the strong presence of the electrical and electronics industry in South India. Cities like Bengaluru, Chennai, and Hyderabad are well-established centers for electrical machinery, industrial automation, and electronics manufacturing. These industries are among the primary consumers of both grain-oriented and non-grain-oriented electrical steel. Additionally, South India has seen rapid urbanization and infrastructure development, including metro rail projects, industrial corridors, IT parks, and smart city initiatives. These projects require extensive power distribution and efficient electrical systems, increasing the demand for high-quality electrical steel in the region.

The proactive state governments in South India have also played a significant role by offering attractive industrial policies, ease of doing business, and incentives for setting up manufacturing units. This has led to the establishment of several domestic and multinational companies in the region, strengthening the supply chain for electrical steel. Furthermore, South India’s better logistics connectivity through well-developed ports like Chennai, Ennore, and Cochin facilitates both import of raw materials and export of finished goods, supporting the growth of the electrical steel market.

Recent Developments

• In January 2025, Steel Authority of India Limited and John Cockerill India moved ahead with plans to invest about $698 million to build a downstream facility in India for cold-rolled grain-oriented and cold-rolled non-oriented electrical steel. News coverage said the proposed plant would have capacity of about 1.5 million tonnes per year, use hot-rolled coil supplied by SAIL, and be targeted for commissioning between 2027 and 2029, making it one of the clearest collaboration-led efforts to localize high-grade electrical steel in India. The project also carried a technology angle because it was linked to the partners’ wider work on green steel and silicon-steel innovation, which is important for transformer, motor, and power-equipment value chains.
• In February 2025, JSW Steel and JFE have successfully completed the acquisition of Thyssenkrupp’s electrical steel business in India. This strategic move strengthens JSW Steel’s position in the high-quality electrical steel segment, enhancing its product portfolio and market reach. Partnering with JFE, a global leader in electrical steel technology, allows JSW Steel to leverage advanced expertise and manufacturing capabilities. The acquisition is expected to boost India’s domestic electrical steel production, supporting growing demand from power and automotive sectors while reducing reliance on imports.
• In January 2025, India has launched a new steel Production-Linked Incentive (PLI) scheme with a total outlay of USD 500 million to boost domestic steel manufacturing. The scheme aims to encourage investment in advanced steel technologies, increase production capacity, and promote value-added steel products. By incentivizing manufacturers, the initiative seeks to reduce import dependence, enhance competitiveness, and support the growth of the steel sector. This move aligns with the government’s broader goal of strengthening India’s manufacturing base and achieving self-reliance in strategic industries.

Key Market Players

• Tata Steel Limited
• JSW Steel Limited
• Jindal Steel and Power Limited
• Steel Authority of India Limited (SAIL)
• Essar Steel India Limited
• Electrosteel Steels Limited
• VISA Steel Limited
• Bhushan Steel Limited

Report Scope:

In this report, the India Electrical Steel Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• India Electrical Steel Market, By Type:

o   Grain Oriented Electrical Steel

o   Non-Grain Oriented Electrical Steel

• India Electrical Steel Market, By Application:

o   Transformers

o   Motors & Generators

o   Inductors

• India Electrical Steel Market, By Vertical:

o   Automotive

o   Construction

o   Manufacturing

o   Energy & Power

o   Others

• India Electrical Steel Market, By Region:

o   South India

o   North India

o   West India

o   East India

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the India Electrical Steel Market.

Available Customizations:

India Electrical Steel Market report with the given market data, Tech Sci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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