H.D. Kumaraswamy Signs ₹11,887 Crore Pact to Expand Specialty Steel

PLI Scheme 1.2 Launched to Strengthen Domestic Steel
The Government of India has launched the Production Linked Incentive (PLI) Scheme 1.2 for Specialty Steel, marking a major step toward boosting high-value domestic steel manufacturing. The official ceremony, held at Vigyan Bhawan, New Delhi, was attended by Union Minister for Steel and Heavy Industries H.D. Kumaraswamy, who highlighted the scheme’s role in advancing India’s Make in India and Aatmanirbhar Bharat initiatives.

PLI 1.2 is aimed at creating a resilient, globally competitive specialty steel ecosystem, focusing on reducing import dependence in critical steel grades used across sectors such as automobiles, railways, aerospace, defence, and electrical equipment.

Major Investments and Capacity Expansion
Under the new scheme, 85 Memoranda of Understanding (MoUs) have been signed with 55 companies, representing committed investments of ₹11,887 crore. These projects are expected to create an additional 8.7 million tonnes of specialty steel capacity by FY 2031. The capacity expansion will cover high-value segments including electrical steel, alloy and stainless steels, coated products, and steel grades essential for strategic applications.

Kumaraswamy emphasized that the third round of the PLI Scheme addresses long-standing industry needs for sustained capacity growth. “PLI 1.2 seeks to address structural gaps by incentivising domestic production, conserving foreign exchange, and positioning India as a reliable global supplier of advanced steel,” he said.

Incentives and Policy Support
The PLI 1.2 scheme offers financial incentives ranging from 4% to 15% over five years, encouraging companies to invest in technology upgradation, value addition, and production of advanced steel products. The scheme also aims to strengthen India’s specialty steel value chain, ensuring that domestic manufacturers can compete on a global scale while meeting strategic sector demands.

Earlier rounds of the PLI program have already demonstrated effectiveness. PLI 1.0 and 1.1 collectively attracted investments of ₹43,874 crore, contributing to capacity creation, employment generation, and enhanced domestic manufacturing capabilities. PLI 1.2 builds upon this foundation, focusing on deeper value-chain integration and the use of indigenous technologies.

Implementation and Industry Collaboration
Kumaraswamy urged participating companies to implement their projects within scheduled timelines and maximize the use of domestic inputs and technologies. He assured industry stakeholders of the government’s support in facilitating operations and resolving potential challenges promptly.

“Successful execution of PLI 1.2 will be pivotal in India’s journey to becoming a global hub for specialty steel manufacturing,” Kumaraswamy added, emphasizing the strategic importance of the sector for India’s industrial growth and technological advancement.

A Step Toward Global Leadership in Specialty Steel
The launch of PLI 1.2 represents a decisive effort to strengthen India’s steel ecosystem by bridging structural gaps and fostering high-value manufacturing. By expanding capacity, encouraging technological innovation, and integrating domestic supply chains, India aims to reduce reliance on imports while meeting the growing demand for specialty steels across critical industries.

As the scheme moves forward, industry analysts expect India to enhance its position in the global steel market, supporting both economic growth and strategic self-reliance. With a combination of policy support, investment incentives, and industry collaboration, the PLI 1.2 initiative is poised to transform India’s specialty steel landscape over the next decade.