India Strengthens Specialty Steel with New PLI Scheme 1.1
Union Minister of Steel and Heavy Industries, Shri H. D. Kumaraswamy, launched the second round of PLI scheme for Specialty Steel, termed as PLI Scheme 1.1 on January 6th, 2025, in the presence of senior officials from the ministry and captains from the industry at Vigyan Bhavan New Delhi.
Shri H.D. Kumaraswamy said, Ministry of Steel has come out with PLI scheme 1.1 for specialty Steel for five product categories which is the same as the existing PLI Scheme to enable further participation as industry participants requested the ministry for relaxation. ‘PLI Scheme 1.1’ will remain open from January 6th to January 31st, 2025. He expressed hope that the industry will participate actively to invest and strengthen Brand India, reduce imports, and position India as a global steel powerhouse. The changes made in PLI scheme for specialty steel reflect the government’s commitment to strengthening domestic production, fostering innovation, and reducing imports.
Shri Sandeep Poundrik, Secretary, Ministry of Steel, mentioned that the PLI scheme 1.1 shall be implemented during the production period of FY 2025-26 to FY 2029-30. He mentioned that there were no participants in 8 sub-categories in the previous round and hoped there would be wider participation this time. Certain changes have been incorporated with industry consultation to make the scheme more investor friendly, which includes reduction in threshold investment & capacity for the CRGO product sub-categories, allowing carry forward of excess production to the immediately following year for the purpose of claiming incentive and reduction in threshold investment under capacity augmentation mode.
PLI Scheme 1.1 covers five (5) product categories in line with the existing PLI Scheme, namely Coated / Plated Steel Products, High Strength / Wear resistant Steel, Specialty Rails, Alloy Steel Products & Steel wires and Electrical Steel. These products have a wide range of application, from white goods to transformers to Automobiles and other niche sectors. The scheme will operate within the funds originally allocated for the scheme, i.e., 
6,322 crore.
Changes to PLI rules have been made based on industry feedback. Not all companies would need to install new mills. Recognising the importance of producing quality steel, energy efficiency and other process improvements, companies investing in augmentation of existing capacities will be allowed to participate in the scheme. Investment in such cases will be 50% of threshold to the guidelines which have been uploaded on the web portal launched today by Hon’ble Minister.
Cold-rolled grain-oriented steel (CRGO) is a high-value steel used in production of power transformers used in HT power distribution. The technology to make CRGO is not available with any of the Indian steelmakers. Considering the strategic importance of becoming atmanirbhar in CRGO, Ministry of Steel has been having regular meetings with stakeholders aimed at increasing production of CRGO within the country. By reducing the investment and capacity creation thresholds to 3,000 crore and 50,000 tonnes respectively, Ministry of Steel hopes that the industry would be enthused to participate in the category.
Companies can carry forward excess production to the immediate following year for the purpose of claiming incentive: In case production by a given company in a given sub-category exceeds its committed production for that year, the excess quantum of production may be carried forward for meeting the shortfall, if any, in achieving the committed production of the immediate next year. This will ensure that incentives are distributed optimally, and no company is denied incentives, if they are unable to achieve an incremental production in the following year after a good year.
