Steel Authority of India Limited (SAIL) has granted first-stage approval to a ₹1,714 crore expansion and modernisation plan for its Alloy Steels Plant in Durgapur, West Bengal. The October 2026 decision is aimed at expanding production of high-grade alloy and speciality steels for the defence, railway and automotive sectors. The project is scheduled for completion within 30 months of receiving second-stage clearance.
What SAIL’s ₹1,714 crore investment covers
The SAIL board granted Stage I approval at its 537th meeting. The core expansion is estimated to cost ₹1,601.94 crore, including a foreign exchange component of ₹138.24 crore for technology and equipment. A further ₹112.13 crore has been allocated for associated packages and enabling works.
The board also authorised the director-in-charge of Durgapur Steel Plant, who oversees the alloy steel unit, to incur expenditure on preparatory works. That allows early work to proceed while the project awaits Stage II clearance, which starts the 30-month completion timetable.
Durgapur plant averaged 39.8% capacity utilisation
The Alloy Steels Plant was established in January 1965 under Hindustan Steel Limited, now SAIL. It produces stainless and non-stainless speciality steels using electric arc furnaces. Its existing facilities include continuous casting, rolling, forging and heat treatment. The plant is located along the Howrah–Delhi main railway line and National Highway 19, around 175 kilometres from Kolkata.
In a March 2026 reply to the Rajya Sabha, the Ministry of Steel put the plant’s operational capacity at 234,000 tonnes a year and its average capacity utilisation at 39.8% between 2020–21 and 2024–25. The nearby Durgapur Steel Plant averaged 101.6% utilisation over the same period against an operational capacity of 2.2 million tonnes a year.
Upgrade follows closer integration with Durgapur Steel Plant
The Centre granted in-principle approval for strategic disinvestment of the Alloy Steels Plant in 2016. SAIL invited expressions of interest in 2018 and 2019, but neither round attracted a qualified bidder. The proposed sale was put on hold in 2020.
SAIL subsequently brought the two Durgapur plants under common operational leadership. Union Steel Minister H. D. Kumaraswamy announced the integration in July 2025. Under the arrangement, Durgapur Steel Plant began supplying hot metal to the Alloy Steels Plant, linking the operations of the two units.
Railways, defence and automotive sectors are the focus
The Ministry of Steel identified the three sectors as the focus of the expansion. SAIL’s published product portfolio for the Durgapur alloy unit includes crane wheels, springs, stainless steel liners and plates. The company has also identified the plant as a supplier of special-quality steel to Indian Railways.
FAQs
How much has SAIL approved for the Alloy Steels Plant upgrade?
SAIL has granted first-stage approval to a plan valued at approximately ₹1,714 crore, including the core expansion and associated works.
When is the Durgapur alloy steel project expected to be completed?
The planned completion period is 30 months from the date of Stage II clearance.
What is the plant’s existing operational capacity?
The Ministry of Steel reported an operational capacity of 234,000 tonnes per year in March 2026.
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