India Finance, January 29, 2024 — Red Sea Crisis Affects 50% of India’s Exports and 30% of Its Imports

1. India’s Union Minister of Coal, Amrit Lal Meena, stated on Sunday that Coal India Limited (CIL) and its subsidiary Western Coalfields Limited (WCL) have identified four to five closed mines to establish green projects, thereby optimizing asset utilization. Speaking to reporters at WCL’s headquarters, Meena said CIL will install integrated solar and pumped-storage hydropower projects on land where coal extraction has been fully exhausted. 2. The Trade Receivables Discounting System (TReDS), an invoice discounting platform supported by the Reserve Bank of India (RBI), reported a sharp increase in the number of invoices financed by lenders in 2023. This electronic platform facilitates credit access for small enterprises that supply goods or services to large corporations. Launched by the RBI in 2018, TReDS initially grew slowly but gained traction as banks and non-bank financial institutions joined the ecosystem. Designed to ease credit access for small businesses, TReDS usage increased over the past year: monthly financing volume nearly doubled year-on-year to approximately ₹110 billion. 3. India is considering a suite of incentives—including preferential financing and long-term loans—for steel manufacturers to support the green transition of steel production and address carbon tax challenges, including the European Union’s Carbon Border Adjustment Mechanism (CBAM). Recommendations from 13 steel industry decarbonization working groups will be compiled into a comprehensive document for stakeholder consultation. This document will propose investment incentives such as preferential financing and long-term loans to ensure a level playing field among domestic steel producers. 4. According to the International Energy Agency (IEA), India’s natural gas demand is projected to grow by 6% in 2024, driven by rising consumption in the fertilizer, power generation, and industrial sectors. After declining by 7% in 2022, India’s primary natural gas supply rose by 5% in 2023—mainly propelled by increased demand from petrochemicals, power generation, refining, and industry. Last week, the IEA’s ‘Gas Market Report’ stated: “India’s natural gas demand is expected to grow by 6% in 2024, primarily due to higher gas use in industry—including fertilizers—and increased gas-fired power generation, supported by expansion of the national pipeline grid and urban gas distribution infrastructure.” By 2023, India’s natural gas demand had risen to 64 billion cubic meters (bcm). Last year, LNG imports grew 7% year-on-year to 29 bcm, accounting for 44% of total domestic gas consumption. Domestic natural gas production rose 6% year-on-year to 35 bcm, boosted by higher output from Reliance Industries’ KG-D6 block. 5. An official report states that, as of December 2023, cost overruns affected as many as 431 infrastructure projects—each requiring an investment of ₹1.5 billion or more—with total overruns exceeding ₹48.2 trillion. According to data from the Ministry of Statistics and Programme Implementation—which monitors infrastructure projects valued at ₹1.5 billion or above—among 1,820 projects, 431 reported cost overruns and 848 faced delays. As of December 2023, cumulative expenditure on these projects stood at ₹16 trillion, representing 53% of their projected total cost. Union Minister of Cooperation Amit Shah will launch a computerization initiative for the National Bank for Agriculture and Rural Development (NABARD) and the Registrar of Cooperatives. In collaboration with the National Cooperative Development Corporation (NCDC), this initiative aims to modernize the cooperative sector, enhance operational efficiency, and digitize the entire cooperative ecosystem. 6. Impacted by new regulations, India’s alternative investment funds (AIFs) have rejected banks’ and financial companies’ demands for “early exit,” and are now exploring how to respond to these investors amid alleged breaches of their “capital commitment” obligations. Following the Reserve Bank of India’s recent “do’s and don’ts” guidance, banks and non-bank financial companies (NBFCs) failed to honor their original commitments to these funds. Will AIFs penalize them? Will the funds forfeit already-invested amounts? Or will the funds make exceptions—capping exposure at contributions made to date—for banks and NBFCs bound by the new rules, in order to preserve relationships with these major investors? 7. Under post-pandemic consolidation plans, India’s fiscal deficit target for FY 2024–25 is expected to decline significantly—potentially falling from 5.9% of GDP this year to 5.3–5.4%. Although capital asset investment is slowing, total market borrowing is still expected to remain high, at around ₹15.3 trillion for FY 2024–25. This downward revision in the fiscal deficit target stems from slower growth in capital expenditure, creating room for fiscal consolidation. The Indian government has committed to reducing the fiscal deficit to below 4.5% of GDP by FY 2025–26.

2026 Commodity Import-Export Analysis: Iron

Upstream: Iron Ore Mining ├── Global seaborne trade volume: ~1.8 billion tonnes/year (2025) ├── Core producing regions ├── Australia (924 million tonnes, 52.5%): Rio Tinto, BHP, Fortescue Metals Group (FMG) ├── Brazil (420 million tonnes, 23.9%): Vale ├── South Africa (66 million tonnes): High-grade ore ├── Canada (62 million tonnes): Core North American supplier └── Simandou (Guinea): 120 million tonnes/year (under construction) ├── Key players: Rio Tinto, BHP, FMG, Vale, China Mineral Resources Group (CMRG) └── Product categories: Fines (for sintering), lumps, pellets ↓ Midstream: Iron Ore Trading & Transportation ├── Global iron ore trade volume: ~1.76 billion tonnes/year ├── Major export ports ├── Australia: Port Hedland, Dampier, Port Walcott ├── Brazil: Ponta da Madeira, Sepetiba, Tubarão └── South Africa: Saldanha Bay ├── Major import ports (China) ├── Caofeidian, Tangshan, Rizhao, Tianjin, Qingdao, Ningbo └── Vessel types: 71% Capesize + 21% Very Large Ore Carriers (VLOCs) [citation:3] └── Pricing mechanisms: Platts 62% Fe Index (benchmark grade to be lowered to 61% starting 2026 [citation:3]), North China Iron Ore Index, long-term contract negotiations ↓ Downstream: Steel Production ├── Ironmaking (Blast Furnace): Iron ore + coke → hot metal ├── Steelmaking (BOF/EAF): Hot metal + scrap → crude steel └── Rolling: Crude steel → finished steel products (rebar, hot-rolled coil, cold-rolled coil, wire rod, etc.) ↓ End-use Sectors ├── Construction/Infrastructure (~50%): rebar, wire rod ├── Machinery Manufacturing (~15%): special steels, plates ├── Automotive (~8%): cold-rolled sheet, galvanized sheet ├── Appliances (~5%): cold-rolled sheet, electrical steel └── Shipbuilding/Energy (~5%): medium-thick plates, pipes 4.2 Key Enterprises Across the Value Chain Segment Enterprise Core Advantage Impact of Falling Iron Ore Prices Upstream Mining (Australia) Rio Tinto, BHP, FMG Low-cost mines, scale advantage Margin compression, yet still profitable Upstream Mining (Brazil) Vale High-grade ore, low-cost S11D mine Premium for high-grade ore provides cushion Upstream Mining (China) China Mineral Resources Group (CMRG) Procurement consortium, bargaining power Lower procurement costs Midstream Trading Glencore, Trafigura Global logistics network Trading margins may narrow Downstream Steel (China) Baowu, Ansteel, Hebei Iron and Steel Group (HBIS) World’s largest crude steel output Lower input costs improve profitability Downstream Steel (India) JSW Steel, Tata Steel Strong demand growth and capacity expansion Lower input costs enhance competitiveness

JSW Steel’s Profit More Than Triples on Higher Prices

Oct 23, 2026

JSW Steel's quarterly profit surged 226% to 52.8 billion rupees driven by rising steel prices and infrastructure demand. The company plans a major capacity expansion amid forecasts that India's steel consumption will triple by 2047.

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JSW Steel’s Profit More Than Triples on Higher Prices

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