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Production Linked Incentive Scheme 1.1

07-01-2025

09:30 AM

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1 min read
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Overview:

Recently, the union Minister of Steel and Heavy Industries launched the second round of PLI scheme for Specialty Steel, termed as PLI Scheme 1.1.

About Production Linked Incentive Scheme 1.1:

  • It shall be implemented during the production period of FY 2025-26 to FY 2029-30.
  • It 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. 
  • Changes in scheme:
    • 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.
    • 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.
  • The Centre had earlier introduced the PLI scheme to encourage domestic production of specialty steel and lower imports by drawing in capital investments.
  • It was initially launched for three sectors to address the need to boost domestic manufacturing during COVID-19 lockdown, the PLI scheme was later extended to include steel in November 2020.

What is Cold-rolled grain-oriented steel (CRGO)?

  • It 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.

Q1: What is Sponge Iron?

It is produced from the direct reduction of iron ore (in the form of lumps, pellets, or fines) by a reducing gas produced from natural gas or coal.

Source: PIB