Revisiting Economic Growth and Steel Consumption: Evidence from India

Abstract

The article analytically investigates the association between GDP growth and steel consumption in India from 2004–2005 to 2019–2020. We investigate the association of both long-term and short-term by employing the Granger causality test in the vector error correction model. The results showed one-way causality between economic growth to steel consumption both in the long and short run and concludes that over the period there is a unidirectional movement from economic development to steel consumption. So, as the economy progresses it has a direct impact on the steel industry. Finally, the study forecast the steel demand for the next decade and highlights the readiness of the steel industry to meet its demand and focus on better utilisation of its capacity. JEL Codes: C51, E2, E27