Union Cabinet approves Rs 6,322-cr PLI scheme for speciality steel
According to the Indian government, the PLI scheme for speciality-steel can create employment of approximately 525,000. 68,000 of these will be direct employment and the remainder indirect.
Anurag Thakur, Information and Broadcasting Minister, stated that the PLI scheme approved by the Union cabinet was worth Rs. The step is intended to boost domestic manufacturing and exports. It costs Rs. 6,322 crore, or US$ 848.9 millions. Incentives worth Rs. Over five years, the incentive will provide Rs. 6,322 crore (US$ 8,48.9 millions) and could create more than 525,000 jobs. This initiative will increase manufacturing and reduce imports. This scheme will cover products such as coated/plated steel products, high strength/wear-resistant steel, specialty rails, alloy steel products, and steel wires. These products are used in a variety applications, including white goods, boilers, armour sheets for defense application, high speed railway lines, turbine parts, and electrical steel for power transformers and other electric vehicles.
The PLI scheme aims to increase the country's high-grade specialty steel production. This will result in increased exports and a lower dependence on imported high-end steel. This scheme will likely result in an investment of around Rs 40,000 crore (5.37 billion USD) and a capacity increase of 25 MT. The scheme will run for five years, and will begin in FY24 through FY28.
India is at the bottom of the steel value chain, and most of the high-value steel grades are imported. The steel industry is facing a number of challenges, including $80-100 per tonne of logistics, infra costs, higher power, capital cost, taxes, and duties. The Indian government stated that the PLI scheme for specialty-grade steel aims to alleviate this problem by encouraging production. Incentives for eligible producers will be paid a 4% to 12% incentive for incremental production. This scheme will help Indian steel industry mature technologically and move up in the value chain.
This scheme applies to Indian companies that manufacture the'specialty' steel grades. It should also ensure that the steel used in making the'specialty' steel is melted and poured in India.
According to the Indian, the scheme will play an important role in strengthening the domestic steel value chain. It will also incentivize the steel sector to invest technologically to increase its contribution to the global steel value chain through the production of value-added steel.