India can avoid up to 20 million tonnes of emissions through India’s ship recycling sector

India can use its ship recycling sector to avoid emissions from its steel industry, according to a new report launched by Climate Group and PWC recently.

The country has the world’s largest installed capacity for ship recycling, which could be vastly increased given its extensive coastline and favourable geographical conditions. The ship recycling industry, primarily based at Alang in Gujarat, processes around one-third of the world’s decommissioned ships. About 80-85% of a ship is made of steel, making it a significant source for scrap or recycled steel, which can be melted down and used as a raw material in crude steel production.

India’s steel industry accounts for 12% of the country’s total greenhouse gas (GHG) emissions, well over the global industry average of 7%. This is because steel production is still heavily coal-dependent. According to the analysis, if India would double its ship recycling capacity by 2028 to accommodate a future upswing in decommissioned ships, upto 20 MT (million tonnes) of emissions could be avoided by 2040 by resulting steel. To fully realise the emissions saving potential, these new ship recycling facilities should adopt advanced technologies and comply with international environmental and safety standards.

Atul Mudaliar, Director of Systems Change, India at Climate Group said:The availability of scrap is a key lever for India to decarbonise its steel industry. Our study explores scrap from ship recycling — an often-overlooked industry as a source of high-quality scrap steel. The report presents a forecast for scrap availability from recycling ships to meet the growing domestic demand for scrap steel. The circular nature of the ship recycling industry would boost the sustainability of the steel industry. We hope the report’s recommendations will provide policymakers, ship recycling and steel industries with pragmatic insights to explore new ways to collaborate and bring down emissions.”

The use of scrap steel can substantially save energy and natural resources such as iron ore, thus avoiding emissions. It is estimated that, on an average, 1,370 kgs of iron ore, 780 kgs of coal and 270 kgs of limestone are saved for every tonne of scrap steel used in steel production.

The Turning the Tide: Ship Recycling as a Source of Green Steel in India report was released in New Delhi. The launch event today focused on the report’s findings and the substantial barriers facing the country’s ship recycling industry. Experts, including from the Ministry of Ports, Shipping and Waterways, Ministry of Steel, steel suppliers and consumers, civil society organisations also discussed the need to develop infrastructure and regulatory frameworks to unlock its true potential.

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