India EV Steel Market, By Type (Non-Grain Oriented, Grain- Oriented) By Application (Entry Level Vehicles, Mid-Level Vehicles, Luxury Class Vehicles, Commercial Class Vehicles) By Location (Motor, Car Body, Battery, Others) By Region, Competition, Forecast & Opportunities, 2021-2031F

Market Overview

India EV Steel Market was valued at USD 24 Billion in 2025 and is expected to reach USD 36 Billion by 2031 with a CAGR of 7.09% during the forecast period. 

Electrical Steel, often referred to as "EV steel", is a specialized type of steel designed for use in electrical applications, primarily in the production of transformers, motors, and generators. It is characterized by its unique magnetic properties, which make it highly effective at conducting electricity while minimizing energy losses due to magnetism. Electrical steel is primarily composed of iron with small amounts of carbon and other alloying elements, which enhance its performance in electrical applications.

There are two main types of electrical steel: grain-oriented (GOES) and non-grain-oriented (NGOES) steels. Grain-oriented electrical steel is processed in a way that aligns the iron crystals in a particular direction, which enhances its magnetic properties along the direction of grain orientation, making it ideal for transformers. Non-grain-oriented electrical steel has a more uniform structure, which allows it to perform well in electric motors and other devices requiring multidirectional magnetic properties.

The key advantages of electrical steel are its high magnetic permeability and low core loss, which ensure efficient energy conversion in electrical machines. The demand for electrical steel has grown due to the increasing need for energy-efficient technologies, particularly in electric vehicles (EVs), renewable energy systems, and industrial motors.

Key Market Drivers

Growth in Electric Vehicle (EV) Adoption

The rapid growth of the electric vehicle (EV) market in India is one of the most significant drivers of the demand for EV steel. With the Indian government pushing for clean energy and sustainability through various initiatives, including subsidies, tax rebates, and infrastructure development, the EV sector has gained tremendous momentum. Electric vehicles require electric motors, which rely heavily on electrical steel for their magnetic properties. This trend is expected to continue as the Indian government aims to achieve a target of 30% electric vehicles on the roads by 2030.

The automotive sector is undergoing a major transformation, with companies increasingly focusing on manufacturing EVs to align with global environmental goals. The Indian government has introduced several measures under the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) Scheme, which encourages the production and purchase of EVs. As EVs become more mainstream, the demand for electrical steel in these vehicles is expected to rise, driven by the need for more efficient, lightweight, and durable motors that can enhance the vehicle's performance and energy efficiency.

India’s push to transition from gasoline and diesel-powered vehicles to EVs is also in response to increasing concerns over air pollution and environmental degradation. This transition, coupled with India’s burgeoning middle class and demand for more sustainable transport options, provides an expanding market for electrical steel. EV steel manufacturers will likely see continued demand for high-quality electrical steel, both for domestic consumption and export, as the country moves closer to its environmental targets. India’s EV sales crossed 1.5 million units in FY 2023-24, marking over 40% growth compared to FY 2022-2023.

Government Policies and Initiatives

The Indian government has been a significant driver of the country’s EV steel market by implementing various policies to encourage the adoption of electric vehicles and clean technologies. Through strategic measures and a forward-looking approach, the government has laid the groundwork for the growth of the EV sector, which, in turn, boosts the demand for electrical steel.

Key policies include the FAME II (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) initiative, which offers financial incentives to manufacturers and buyers of electric vehicles. The government also encourages the establishment of EV charging stations and battery-swapping infrastructure to alleviate concerns over range anxiety among consumers. These policies are crucial in ensuring that EVs are accessible, affordable, and viable as an alternative to conventional vehicles, which is directly linked to an increase in demand for electrical steel. Furthermore, the National Electric Mobility Mission Plan (NEMMP) 2020 aims to provide a long-term framework to drive the adoption of electric vehicles in India. The plan sets ambitious targets for electric vehicle production and sales, which will inevitably increase the need for electrical steel. In addition, India’s push toward renewable energy sources, such as wind and solar power, further drives the demand for EV steel, as electrical steel plays a key role in the manufacturing of transformers, generators, and motors used in the renewable energy sector.

The government's focus on promoting the local manufacturing of electric vehicles also benefits Indian manufacturers of electrical steel, who are positioned to tap into the expanding market. This will lead to more opportunities for domestic suppliers of EV steel and foster innovation in steel production techniques, allowing India to become more competitive on a global scale.

Increased Focus on Energy Efficiency

Energy efficiency has become a major concern globally, and India is no exception. As the country seeks to meet its growing energy demands while reducing carbon emissions, there is a significant focus on adopting technologies that improve energy efficiency. Electrical steel plays a critical role in this transition, as it is a key material in the manufacturing of electrical equipment, including transformers, motors, and generators. The performance of these devices is highly dependent on the quality of electrical steel used in their construction.

India’s energy sector is undergoing substantial reforms, with a strong push toward improving power generation, transmission, and distribution efficiency. As part of this effort, the Indian government has been encouraging the use of high-efficiency transformers and motors, which rely on electrical steel to minimize energy losses. This has created a growing demand for high-quality electrical steel that can support the country's energy efficiency goals.

The adoption of energy-efficient technologies is not limited to the power sector alone. Industries such as manufacturing, transportation, and agriculture are increasingly incorporating energy-efficient solutions into their operations to reduce costs and improve sustainability. Electrical steel, being a vital material in the production of energy-efficient electric motors and transformers, is at the forefront of this shift. As industries across India embrace energy-saving technologies, the demand for electrical steel will continue to rise, driving the market’s growth.

The trend toward energy efficiency is also closely linked to India’s broader commitment to reducing its carbon footprint and meeting global climate targets. By using high-performance electrical steel, the country can improve the efficiency of its electric power systems and industrial machines, contributing to a more sustainable and low-carbon economy. The demand for electrical steel will be closely tied to these sustainability efforts, creating a long-term driver for the market. India's FAME II scheme targets the adoption of 1 million electric two-wheelers and 7,000 electric buses, creating demand for highly energy-efficient motors made using non-grain oriented electrical steel.

Technological Advancements in Steel Production

Advancements in steel production technologies are playing a critical role in driving the growth of the EV steel market in India. Innovations in the manufacturing of electrical steel have led to the production of materials with superior magnetic properties, allowing for more efficient power conversion in electric vehicles, motors, and transformers. These technological improvements are making electrical steel a more viable option for manufacturers of energy-efficient products, creating a ripple effect across industries.

In particular, the development of grain-oriented electrical steel (GOES) and non-grain-oriented electrical steel (NGOES) has significantly enhanced the performance of electrical devices. The ability to produce steel with higher magnetic permeability and lower core loss has made it possible to create motors and transformers that are more energy-efficient and capable of handling higher power loads. These advancements are crucial for industries such as automotive, renewable energy, and electrical infrastructure, where efficiency is paramount.

India’s steel manufacturers are increasingly adopting state-of-the-art technologies such as continuous casting, cold rolling, and annealing processes to improve the quality of electrical steel. These technologies allow for better control over the microstructure of the steel, leading to improved magnetic properties and mechanical strength. The adoption of these advanced manufacturing techniques will further drive the demand for high-quality electrical steel, positioning India as a key player in the global EV steel market.

The rise of automation, artificial intelligence, and data analytics in steel production has also resulted in more streamlined and cost-effective manufacturing processes. As a result, manufacturers can produce electrical steel in greater quantities and at lower costs, making it more accessible to a wider range of industries. This increased availability of high-quality electrical steel is expected to meet the growing demand from the electric vehicle and energy sectors in India, providing a robust foundation for future market growth. Indian steel manufacturers are increasingly transitioning from traditional blast furnaces to Electric Arc Furnaces, which are more energy-efficient and environmentally friendly. This shift supports the production of cleaner electrical steel, crucial for EV applications.

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Key Market Challenges

Supply Chain and Raw Material Constraints

One of the major challenges facing the electric vehicle (EV) steel market in India is the constraints within the supply chain and raw materials. Electrical steel is a highly specialized material, and its production requires specific raw materials, such as high-purity iron, silicon, and other alloying elements. These materials are not always abundantly available in India, and securing a steady supply can be difficult. India largely depends on imports for key raw materials, which can lead to issues with pricing volatility, import restrictions, and logistical challenges.

The supply of silicon steel, which is integral to the production of electrical steel, is a critical concern. While India has abundant iron ore, the availability of high-grade silicon and other alloying elements is limited. This gap necessitates importing these materials from countries like China, Japan, and the United States, which can result in delays, fluctuating prices, and potential trade disruptions. Such dependency on foreign markets can hinder the stability of the Indian EV steel supply chain, particularly as demand for electric vehicles grows.

The logistical challenges further complicate this issue. The transportation of raw materials from ports to manufacturing facilities can be a bottleneck due to insufficient infrastructure, leading to delays and higher transportation costs. Furthermore, the energy-intensive nature of electrical steel production, combined with the fluctuating energy prices in India, adds another layer of complexity. Manufacturers may face challenges in securing a consistent supply of energy at competitive prices, which could hinder production timelines and increase overall costs.

Another issue is the lack of advanced manufacturing capabilities within India to produce high-quality electrical steel at scale. While India’s steel industry is large, there are still gaps in the capability to produce high-performance grain-oriented electrical steel (GOES), which is used extensively in transformers and motors. Indian manufacturers may struggle to meet the high-quality standards required by the growing EV market, especially as global demand for electrical steel increases. Without the development of advanced production techniques and an improved raw material supply chain, India may find it difficult to fulfill both domestic and international demand for EV steel.

High Production Costs and Investment Requirements

The high production costs associated with manufacturing electrical steel pose another significant challenge to the growth of the EV steel market in India. The process of producing electrical steel is highly complex and energy-intensive, requiring substantial capital investment in advanced equipment, technology, and skilled labor. This can lead to high upfront costs, making it difficult for smaller or emerging manufacturers to enter the market and scale their operations. As the demand for high-quality electrical steel continues to grow due to the rise in electric vehicles, manufacturers are under pressure to modernize their facilities and adopt cutting-edge technologies, but this requires significant financial investment.

The production of grain-oriented electrical steel (GOES), for example, involves an intricate process that includes the precise control of temperature, magnetic properties, and chemical composition. Achieving the level of performance required for EV applications, such as minimal core losses and enhanced efficiency, demands the use of specialized machinery and techniques. Moreover, to meet international quality standards, Indian manufacturers must invest heavily in research and development (R&D) to innovate and refine their production processes. In addition to the capital expenditure on equipment, the cost of raw materials also contributes significantly to the overall production costs. As mentioned earlier, India’s dependency on imports for crucial raw materials like silicon and high-purity iron further increases expenses. Any fluctuation in the prices of these materials, due to supply-demand imbalances or geopolitical factors, can result in increased production costs, further squeezing profit margins.

The high production costs can be particularly challenging for Indian manufacturers of electrical steel who are looking to compete on a global scale. As the demand for electrical steel in sectors such as automotive and renewable energy grows, manufacturers must focus on reducing production costs to remain competitive. This can be achieved by adopting lean manufacturing processes, improving supply chain efficiencies, and making long-term investments in advanced production technologies. However, for many smaller players, the high upfront costs and lack of access to capital may limit their ability to keep pace with the growth of the EV steel market, thereby hindering the overall competitiveness of India’s steel industry in the global market.

The relatively high cost of skilled labor, especially in specialized steel production and quality control, further drives up the operational expenses for manufacturers. Although there is a growing emphasis on automation and digitalization, which can help mitigate labor-related costs, these technological advancements also require significant investment, which many smaller manufacturers may find difficult to secure.

Key Market Trends

Shift Toward High-Performance Electrical Steel

One of the key trends in the Indian EV steel market is the growing demand for high-performance electrical steel, particularly grain-oriented electrical steel (GOES). As the adoption of electric vehicles (EVs) increases, manufacturers are placing a higher emphasis on improving the efficiency of electric motors, transformers, and other electrical components. GOES is critical in this context, as it significantly reduces energy loss and improves the magnetic properties of devices that rely on electrical steel.

In electric vehicles, high-performance electrical steel allows for more compact and efficient motors, which can enhance vehicle performance and range. This trend is driving an increased demand for GOES, particularly in the automotive sector, where electric motors are crucial for propulsion. Similarly, in the renewable energy sector, where transformers and generators are used to convert and distribute energy, the need for low core loss and high magnetic permeability is pushing the market toward advanced electrical steel.

Manufacturers in India are recognizing the importance of adopting high-performance steel to cater to both domestic and international markets. India’s automotive industry, which is one of the largest in the world, is beginning to ramp up its production of electric vehicles, creating a larger market for high-quality electrical steel. The demand for GOES is expected to grow as automotive manufacturers move toward more energy-efficient models, in line with the global push for sustainability.

The need for high-performance steel is driven by the increasing focus on energy efficiency and sustainability in both industrial and consumer sectors. India’s power sector, which includes the generation, transmission, and distribution of electricity, also relies on electrical steel for transformers and other equipment. As India continues to push toward achieving its climate goals, manufacturers of electrical steel are increasingly focused on developing high-performance materials that contribute to greater energy savings and reduced carbon emissions.

Integration of Advanced Manufacturing Technologies

The integration of advanced manufacturing technologies is transforming the Indian EV steel market. As the demand for high-quality electrical steel rises, Indian manufacturers are increasingly adopting state-of-the-art production techniques to improve the efficiency and quality of their output. These advancements are not only helping to meet the growing demand for electrical steel but also allowing manufacturers to reduce production costs and enhance overall competitiveness in the global market.

A significant trend in this area is the adoption of digitalization and automation within the steel production process. Technologies like smart sensors, Internet of Things (IoT), and artificial intelligence (AI) are being used to monitor and optimize the production of electrical steel. These tools allow for better control over the manufacturing process, ensuring that the steel produced meets the required standards for use in electric vehicles, transformers, and motors. Additionally, automation helps to reduce human error, minimize waste, and improve production efficiency.

Another key trend is the use of 3D modeling and simulation in the design phase, which allows manufacturers to optimize the steel's magnetic properties and mechanical strength before production even begins. This enables manufacturers to produce electrical steel with the precise characteristics needed for different applications, reducing the time spent on trial and error and improving the overall quality of the final product. Moreover, advancements in high-efficiency cold-rolling and annealing processes have enabled the production of thinner, more uniform electrical steel sheets, which are essential for achieving the desired performance in electric motors and transformers. These innovations are crucial in reducing material waste and improving the overall cost-effectiveness of electrical steel production.

As India’s steel industry continues to modernize, the integration of advanced technologies is expected to drive greater efficiency, reduce environmental impact, and enable manufacturers to meet the increasing demand for high-quality electrical steel from sectors such as automotive, renewable energy, and industrial applications.

Segmental Insights

Type Insights

The Non-Grain Oriented held the largest market share in 2025. Non-Grain Oriented Electrical Steel (NGOES) dominates the India EV steel market primarily due to its suitability for electric motors, which are a core component of electric vehicles (EVs). Unlike Grain-Oriented Electrical Steel (GOES), which is specifically designed for applications requiring highly directional magnetic properties (such as transformers), NGOES is valued for its versatile and multidirectional magnetic characteristics. This versatility makes it ideal for use in electric motors, where the magnetic flux is constantly changing directions.

In electric vehicles, NGOES is used extensively in the production of traction motors, which are essential for vehicle propulsion. These motors operate in multiple directions as they convert electrical energy into mechanical energy to drive the vehicle. NGOES provides the necessary efficiency and performance in these motors by minimizing core losses and improving energy conversion efficiency. The growing demand for EVs, driven by government incentives, environmental awareness, and a shift towards sustainable transportation, has directly increased the need for NGOES in India’s automotive industry.

NGOES offers better cost-effectiveness compared to GOES for motor applications. While GOES is specialized for transformer cores and offers superior performance in specific applications, it is more expensive and less suitable for the dynamic, multidirectional operation required in EV motors. Therefore, manufacturers in India prefer NGOES as it provides the necessary magnetic properties at a more affordable price point, making it the go-to material for electric vehicle manufacturers looking to balance cost with efficiency.

As India accelerates its transition to electric mobility, the demand for electric motors will continue to rise, further solidifying the dominance of NGOES in the EV steel market. This trend aligns with the country’s broader goals of increasing EV adoption and reducing emissions, positioning NGOES as a critical material for the evolving automotive landscape.

Application Insights

The Entry Level Vehicles held the largest market share in 2025.  Entry-level electric vehicles (EVs) dominate the India EV steel market due to a combination of factors, including affordability, government incentives, and the growing demand for cost-effective transportation options in a price-sensitive market like India.

Affordability is a primary driver in the Indian EV market, where consumers are highly price-conscious. Entry-level EVs, which offer basic features at a lower price point, are more accessible to the average Indian consumer. These vehicles are typically designed to cater to urban commuters, small families, or first-time EV buyers who seek economical and sustainable transportation options. As the initial cost of electric vehicles is often higher than that of conventional internal combustion engine vehicles, consumers are more inclined to choose entry-level models, which are priced more competitively and align with India's growing demand for affordable electric mobility.

The Indian government has also played a key role in making entry-level EVs more attractive by offering incentives under schemes like the FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) initiative. These incentives help reduce the upfront cost of EVs, making entry-level models more affordable. The government’s focus on increasing the adoption of electric vehicles, especially in the lower price bracket, aligns with its sustainability and air quality goals. Furthermore, the emphasis on local manufacturing and reducing import duties also makes entry-level EVs more cost-effective, leading to their dominance in the market.

As a result, these entry-level EVs often rely on non-grain oriented electrical steel (NGOES) for their motors, as it offers excellent performance at a lower cost compared to grain-oriented steel, making it an ideal material for these affordable vehicles. This further drives demand for NGOES in the India EV steel market, which aligns with the growing preference for entry-level electric vehicles.

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Regional Insights

West India held the largest market share in 2025. West India dominates the India EV steel market due to several strategic advantages related to industrial infrastructure, proximity to key manufacturing hubs, and regional economic policies. This region, which includes states like Maharashtra, and Gujarat, has become a central hub for the country's growing electric vehicle (EV) industry and steel production.

West India boasts a robust industrial infrastructure, which includes well-developed manufacturing facilities, ports, and transportation networks. Mumbai, Pune, and Ahmedabad are key centers for automotive and manufacturing industries, housing major automotive players, suppliers, and OEMs (Original Equipment Manufacturers). The region’s proximity to key ports, such as the Jawaharlal Nehru Port and Mundra Port, provides easy access to raw materials and export markets, facilitating smoother supply chains for electrical steel production and EV manufacturing.

Maharashtra and Gujarat have been at the forefront of attracting investment in electric vehicles and clean technologies, thanks to favorable state-level policies, incentives, and subsidies. The government’s support for infrastructure development, including EV charging stations and manufacturing plants, makes West India an attractive location for both EV steel producers and automotive manufacturers. Gujarat, for example, is a hub for solar power and other renewable energy industries, aligning with the push for energy-efficient technologies that use electrical steel in EV motors and related components.

The region is home to some of India's largest steel manufacturers, including Tata Steel and JSW Steel, which have established advanced production facilities for electrical steel. Their proximity to the automotive sector allows for seamless collaboration and quicker production timelines, meeting the increasing demand for high-quality Non-Grain Oriented Electrical Steel (NGOES) used in EV motors.

Recent Developments

• In January 2025, India has introduced a new Production Linked Incentive (PLI) scheme for the steel sector to boost the manufacturing of specialty steel, including electrical steel essential for electric vehicles. The scheme aims to enhance domestic production, reduce import dependency, and promote advanced steel technologies. With a focus on high-grade steel used in energy-efficient applications, the initiative is expected to attract significant investment, encourage innovation, and strengthen India’s position as a global hub for high-performance and value-added steel production.
• In February 2025, JSW Steel, in partnership with Japan’s JFE Steel, has successfully completed the acquisition of Thyssenkrupp’s electrical steel business in India. This strategic move enhances their capabilities in producing high-grade electrical steel, crucial for electric vehicles and energy applications. The acquisition strengthens JSW-JFE’s position in the domestic specialty steel market, supports the Make in India initiative, and reduces reliance on imports. It also marks a significant step toward meeting growing demand for advanced electrical steel in the evolving EV ecosystem.
• India is the world’s second-largest producer of crude steel, with an output of 125.32 MT of crude steel and finished steel production of 121.29 MT in FY23.

Key Market Players

• Steel Authority of India Limited
• MI Electrical Steel Processing India Pvt. Ltd.
• JSW MI Steel
• NLMK India
• Shanxi Honglu Sanli
• JFE Steel Corporation
• Bao Steel India
• POSCO Electrical Steel India

Report Scope:

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

• India EV Steel Market, By Type:

o   Non-Grain Oriented

o   Grain- Oriented

• India EV Steel Market, By Application:

o   Entry Level Vehicles

o   Mid-Level Vehicles

o   Luxury Class Vehicles

o   Commercial Class Vehicles  

• India EV Steel Market, By Location:

o   Motor

o   Car Body

o   Battery

o   Others

• India EV 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 EV Steel Market.

Available Customizations:

India EV 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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