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Under the Production Linked Incentive (PLI) Scheme for Specialty Steel, 57 MoUs have been executed for generating an investment of ₹29,500 crores, an additional capacity of 25 MT for producing speciality steel grades and additional employment to about 17,000 people by FY 2027-28. It may be mentioned that the PLI scheme, a vital initiative in India's industrial growth trajectory, was notified in July 2021 to foster investments and enhance capacities in the speciality steel segment.
As of Dec ’23, the selected companies have already invested about ₹12,900 crores against an investment commitment of ₹21,000 crores up to the current financial year. It is expected that these companies will invest another ₹3,000 crores during FY’24, i.e., about ₹16,000 crores of a total of ₹29,500 crores will be invested by FY 2023-24. The Ministry of Steel envisages an investment of ₹10,000 crore in FY 2024-25. It is also pertinent to mention that 5 units have begun production, and 9 more units are expected to begin production in this quarter.
Typically, investments in the steel sector have a long gestation period and depend on, inter alia, the procurement of various equipment, many of which are sourced from abroad. Delays due to unavoidable circumstances in the projects include supply chain delays due to geopolitical issues, unforeseen events, natural disasters, and changed market circumstances for certain PLI products, which also impact the pace, phasing, and quantum of investment.
The Ministry of Steel, along with other relevant government departments, has been proactively engaging with the PLI beneficiaries to resolve issues faced by companies and facilitate their meeting their commitments under PLI. Measures have been taken to expedite clearances for projects, issue standard operating procedures for Indian visas for experts, and address the concerns of the participating companies by continuous engagement with the stakeholders.
In view of the above and the significant growth of the economy, especially infrastructure, the demand for speciality steel would continue to show strong acceleration, and PLI MoU holders would make up for the shortfall in investment. The Ministry of Steel is confident that the scheme will achieve its desired objectives, notwithstanding the temporary setbacks.
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