Snapshot
Specialty steel is value added steel used in various strategic applications like Defence, Space and Power.
PLI Scheme for specialty steel aims to make India at par with advanced steel making countries like South Korea and Japan.
According to Union Minister Jyotiraditya Scindia, the scheme has received 79 applications from 35 companies, resulting in an investment of Rs 46,020 crore.
The PLI Scheme (Productivity Linked Incentive) for speciality steel approved by the union cabinet in July 2021 has received 79 applications from 35 companies, resulting in an investment of Rs 46,020 crore.
It leads to an increase in capacity of almost 26 million tons with an employment generation potential for around 70,000 people.
Delivering the keynote address at the third conclave of the Indian Steel Association (ISA) on Monday (21 November), Union Minister of Steel Jyotiraditya Scindia has stated the above information.
He further stated that the policy of using domestic steel has saved Rs 22,400 crores on steel imports and urged the industry to adopt a circular economy approach which would involve a gradual movement towards steel production from scrap.
“The Prime Minister has put forth the mandate to enhance capital infrastructure by nearly Rs 17 lakh crore per year, thus increasing demand for steel by close to double digits,” Scindia said.
“Our sector has witnessed a huge transformation during the past eight years, and has emerged globally from being a 4th largest producer to the 2nd largest producer and the 2nd largest consumer of steel,” he added.
Specialty of ‘Specialty steel’
The Union Cabinet approved the Production Linked Incentive (PLI) Scheme for specialty steel in July 2021 with a budgetary outlay of Rs 6,322 crore.
The duration of the scheme will be five years, from 2023-24 to 2027-28. The scheme was introduced to bring in investment of approximately Rs 40,000 crores and capacity addition of 25 MT for speciality steel which will give employment to about 5,25,000 people of which 68,000 will be direct employment.
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.
Speciality steel has been chosen as the target segment because out of the production of 102 million tonnes steel in India in 2020-21, only 18 million tonnes value added steel or speciality steel was produced in the country.
Apart from this out of 6.7 million tonnes of imports in the same year, around four million tonnes import was of specialty steel alone resulting in foreign exchange outgo of almost Rs 30,000 crore.
By becoming self-reliant in producing speciality steel, India will move up the steel value chain and come at par with advanced steel making countries like South Korea and Japan.
It is expected 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.
Similarly, the export of specialty steel will become around 5.5 million tonnes as against the current 1.7 million tonnes of specialty steel, thus India receives FOREX of Rs 33,000 crore.