The EU is about to pass its Industrial Accelerator Act, a law that requires public funds to prioritize locally produced materials in strategic sectors. Batteries, solar, wind, hydrogen, nuclear, EVs - all covered. Steel? Not yet. And the steel industry is furious.
What's Happening
The EU's "Made in Europe" provision was supposed to launch this week but was delayed over a central question: what counts as "local"?
Steel industry (EUROFER) position:
"Local" = EU + close neighbors only (UK, Norway, Iceland, Liechtenstein)
Steel should be included as a strategic sector
Only steel "melted and poured" in Europe should qualify for public subsidies
Otherwise, EU money meant to decarbonize European steel could end up funding green steel production in China or India
Automakers' position:
"Local" should include all free trade agreement (FTA) partners, such as Turkey, Morocco, etc.
They need flexibility to source from existing supply chains
A narrow definition locks them into higher costs
Latest update (March 3, 2026): The EU axed the voluntary emissions label for low-carbon steel from the latest draft. Steel producers wanted this label to make their cleaner products visible to buyers. The Commission killed it, citing concerns over "complex bureaucracy."
Why This Matters for Indian Manufacturers
If the EU defines "local" narrowly: EU + close neighbors only, Indian steel and components are locked out of EU public procurement, even if you're making low-carbon products.
If they go broad and include FTA partners, there's a window. But India doesn't have a comprehensive FTA with the EU yet (negotiations ongoing), so this still doesn't help in the short term.
The 25% rule: Under the draft proposal, at least 25% of steel used in public procurement and support schemes must be low-carbon. But the draft doesn't require it to be produced in Europe. Steel lobby wants both, low-carbon AND European origin. If they win, Indian steel gets shut out entirely.
The Real Fight
Europe is stuck between two competing pressures:
Industrial sovereignty, don't let EU subsidies fund Chinese or foreign production
Cost competitiveness, European manufacturers can't afford to lock themselves into expensive local-only supply chains when competitors in the US, China, and India all source globally
India, China and the US all "buy national" for their entire production base. Europe is trying to do it selectively for strategic sectors. The steel industry's argument: "If decarbonization is strategic, steel is strategic. Include us or we can't justify the investment."
What's Next
The Industrial Accelerator Act is expected to be formally proposed early March 2026 (this week or next). Watch for:
Whether steel gets included as a strategic sector
The final definition of "local" (narrow or broad)
How the 25% low-carbon steel requirement gets enforced