India Unveils New Steel PLI Scheme with Rs 4,300 Crore Outlay

The Indian government unveiled an updated version of its production-linked incentive (PLI) scheme for the steel sector on 6th January 2025. In a statement shared earlier, the steel ministry said, “Union Minister of Steel and Heavy Industries…will launch ’PLI scheme 1.1’ for the steel industry and call for applications…on January 6,”.

The government has allocated approximately Rs 4,300 crore for the revamped PLI scheme aimed at enhancing the manufacturing of speciality and electrical steel. Speciality steel, a high-grade material, is crucial for industries such as defense, automotive, and electronics.

Initially introduced to boost domestic production and reduce imports, the first phase of the PLI scheme attracted investments worth Rs 27106 crore, leading to the creation of 14760 direct jobs and an estimated output of 7.90 million tonnes of specialty steel.

By November 2024, companies had already invested Rs 18300 crore, generating over 8660 jobs. Following consultations with industry stakeholders, the government has decided to revise and relaunch the scheme to encourage broader participation and drive further growth.

The PLI initiative was originally introduced in 2020 during the global lockdowns to strengthen domestic manufacturing. Initially covering three sectors, it expanded to include steel in November 2020. While the first phase saw moderate participation, the revised scheme addresses industry feedback to better align with sectoral demands. With specialty steel in high demand across multiple industries, the government remains committed to supporting its growth through strategic incentives and investments.