Government Unveils PLI Scheme 1.1 to Enhance High-Value Specialty Steel Production
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New Delhi, Jan 26 (NationPress) Union Minister of Steel and Heavy Industries H. D. Kumaraswamy initiated the second phase of the PLI scheme on Monday to enhance the production of high-value specialty steel in the nation, which is vital for creating products like refrigerators, power equipment, and automobiles.
Kumaraswamy mentioned that the Ministry of Steel has introduced PLI scheme 1.1 for specialty steel across five product categories, mirroring the current PLI Scheme to facilitate greater engagement as industry stakeholders requested the ministry for leniency.
The minister stated that PLI Scheme 1.1 will be available from January 6 to January 31, 2025, and expressed optimism that the industry will actively participate to invest in and fortify Brand India, diminish imports, and establish India as a global leader in steel production.
The adjustments made to the PLI scheme for specialty steel showcase the government’s dedication to bolstering domestic production, encouraging innovation, and cutting down imports, according to the minister.
Sandeep Poundrik, Secretary of the Ministry of Steel, noted that PLI scheme 1.1 will be executed during the production phase from FY 2025-26 to FY 2029-30. He pointed out that there were no participants in eight sub-categories during the previous round and expressed hope for broader involvement this time.
Several modifications have been integrated based on industry consultation to enhance the scheme's appeal to investors, including a decrease in threshold investment & capacity for the CRGO product sub-categories, permitting the carry forward of excess production to the subsequent year for claiming incentives, and a reduction in threshold investment under the capacity augmentation mode.
PLI Scheme 1.1 encompasses five product categories in alignment with the current PLI Scheme, namely coated/plated steel products, high strength/wear resistant steel, specialty rails, alloy steel products & steel wires, and electrical steel. These products have diverse applications, ranging from white goods to transformers to automobiles and other specialized sectors. The scheme will function within the originally allocated funds of Rs.6,322 crore.
Modifications to PLI regulations have been instituted based on industry input. Not all companies are required to establish new mills. Acknowledging the significance of producing quality steel, enhancing energy efficiency, and other process improvements, companies investing in upgrading existing capacities will be permitted to join the scheme. Investment in such instances will be 50% of the threshold outlined in the guidelines available on the Ministry's web portal.
The policy will include cold-rolled grain-oriented steel (CRGO), a premium steel utilized in manufacturing power transformers for HT power distribution. The technology for producing CRGO is currently unavailable among Indian steelmakers. Recognizing the strategic importance of achieving Aatmanirbhar in CRGO, the Ministry of Steel has been consistently engaging with stakeholders to boost CRGO production within the nation. By lowering the investment and capacity creation thresholds to Rs.3,000 crore and 50,000 tonnes respectively, the Ministry of Steel anticipates that the industry will be motivated to participate in this category.
The inaugural phase of the Production Linked Incentive (PLI) Scheme for Specialty Steel was announced on July 29, 2021, by the Ministry of Steel with a budget allocation of Rs 6,322 crore.
