Union Cabinet has approved the Production Linked Incentive (PLI) Scheme for specialty steel. The duration of the scheme will be five years, from 2023-24 to 2027-28.
- With a budgetary outlay of ₹6322 crores, the scheme is expected to bring in investment of approximately ₹40,000 crores and capacity addition of 25 MT for speciality steel.
- Per group, the inceptive is capped at Rs 200 crore. So, no company will get the incentive of more than Rs. 200 crore per year.
- The scheme will give employment to about 5,25,000 people of which 68,000 will be direct employment.
The five categories of specialty steel which have been chosen in the PLI Scheme are:
- Coated/Plated Steel Products
- High Strength/Wear resistant Steel
- Specialty Rails
- Alloy Steel Products and Steel wires
- Electrical Steel
Why PLI scheme for specialty steel?
- Speciality steel has been chosen as the target segment because out of the production of 102 million tonnes steel in India in 2020-21, only18 million tonnes value added steel/speciality steel was produced in the country.
- Apart from this out of 6.7 million tonnes of imports in the same year, approx. 4 million tonnes import was of specialty steel alone resulting in FOREX outgo of Approx. Rs. 30,000 crores.
Benefits
- Government expects that the speciality steel production will become 42 million tonnes by the end of 2026-27. This will ensure that approximately 2.5 lakh crores worth of speciality steel will be produced and consumed in the country which would otherwise have been imported.
What is specialty steel?
- Specialty steel is value added steel wherein normal finished steel is worked upon by way of coating, plating, heat treatment, etc to convert it into high value added steel which can be used in various strategic applications like Defence, Space, Power, apart from automobile sector, specialized capital goods etc.
