The government on Friday signed memorandums of understanding (MoU) with 27 companies, kickstarting the Rs 6,322-crore production-linked incentives (PLI) scheme for specialty steel, that is expected to generate investments of up to Rs 30,000 crore over the coming five years.
The scheme will create 25 million tonnes of additional specialty steel manufacturing in the country and create 55,000 new jobs as per a statement by the Indian Steel Association (ISA).
All the primary steelmakers in the country like Tata Steel, JSW Steel, Steel Authority of India, ArcelorMittal Nippon Steel India and Jindal Steel & Power are part of the scheme directly or through subsidiaries. Additionally, multiple smaller secondary steelmakers have also qualified for the scheme.
In all, MoUs for 57 applications from the 27 companies were signed on Friday.
“The PLI Scheme for speciality steel is bringing in very large investments for capacity build up and will make India self-reliant in almost the entire range of steel Products,” said Alok Sahay, Secretary-General, Indian Steel Association.
“Even today a miniscule quantity is required through imports,” he said. But considering the fast-paced growth in sectors such as automobiles, capital goods, white and yellow goods and the intermediate sector, a delay in capacity augmentation of speciality steel would have led to import dependence in the future, he added.
Specialty steels include value-added grades of steel made by processing finished steel. While India is the world’s second largest manufacturer of steel, the country still relies on imports for its specialty steel requirement.
Some examples of specialty steel include alloy steel, coated and plated steels, electrical steel, high strength steel and wear resistant steel. Electrical steel is used in applications like power distribution, transformers and electric motors and India relies on supplies from countries like Japan and South Korea for this.
“All the steel players will be part of PLI Scheme and with this initiative the Ministry of Steel and Steel Industry are partnering each other to complement and supplement towards the growth of steel industry with commitments from both the sides,” said Dilip Oommen, President, Indian Steel Association.