The Indian government will roll out the next phase of the Production-Linked Incentive (PLI) scheme named "PLI Scheme 1.1" for the steel sector on January 6, 2025. It aims to raise the domestic production of such high-grade specialty steels which are mostly essential for industries like defence, automotive, and electricals. The key target under this program is import substitution of such types of steel in India, innovation, and bolstering India as a global hub in manufacturing.
The government of India designed the PLI scheme in 2020 to help the domestic industry recover during the COVID-19 pandemic. The first phase of the scheme was dedicated to specialty steel, which has attracted ₹27,106 crore worth of investment and has created nearly 14,760 direct jobs, along with an estimated production of 7.9 million tonnes of specialty steel. As of November 2024, companies had invested ₹18,300 crore and created more than 8,660 jobs with such a very bright potential for growth.
The first phase of the PLI scheme was not successful in meeting all the expectations, especially in specialty steel production. High-grade steel, which is essential for critical sectors like defence and automotive, continues to be an area of concern. Based on inputs and feedback from the industry players, the government decided to undertake the new PLI Scheme 1.1. It would be a more targeted approach to closing those gaps and attracting greater participation, culminating in an increase of production.
The Union Minister of Steel and Heavy Industries, Shri H.D. Kumaraswamy, will inaugurate the scheme at a function held at Vigyan Bhavan, New Delhi, where applications are invited. The new round of the PLI scheme is expected to increase investments and further strengthen India's competitive edge in the steel sector," the Government stated.
Starting with its modular availability in three sectors, the PLI initiative now goes ahead to steel in November of the same year. The government continued to avow the significance of the steel sector as the lifeblood of India's economic growth and development; the launch of PLI Scheme 1.1 was geared towards achieving increasingly self-sufficiency, supporting excellence in manufacturing, and driving innovations in that very important field.
Conclusion
This launch of PLI Scheme 1.1 signifies an important step towards strengthening India’s steel sector and making it self-reliant on high-grade specialty steel production. Continuing the government’s commitment to catapult domestic manufacturing to heights, this new avatar of the scheme is likely to attract more investment, innovation, and job creation. In fact, specialty steel production-needs such as defence, automotive manufacturing as well as electrical, could help India to become export-dependent and build itself into a global manufacturing powerhouse. Such reforms driven by feedback in the scheme are a mark of the forward-thinking approach that the government has towards meeting the industry's ever-changing demands and achieving sustainable growth for the steel sector in the years ahead.
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