The government has deferred by a year the implementation of the `6,322-crore production-linked incentive (PLI) scheme to promote and boost production of speciality steel domestically. Instead of 2022-23, the five-year scheme will now commence from 2023-24.The release of the incentives under the scheme will now start from 2024-25 instead of 2023-24 proposed in the scheme guideline issued in October.

The Cabinet had approved the PLI scheme for speciality steel on July 22.Speciality steel is a value-added variety of the alloy wherein normal finished steel is worked upon by way of coating, plating, heat treatment, etc, to convert it into high value-added steel for use in various strategic sectors such as defence, space, power and automobiles among others. India meets the domestic requirement of such steel with imports with an annual forex outgo of around Rs 30,000 crore.Sources said that the implementation of scheme has been deferred following requests from the industry and potential applicants.

They wanted time to ready the required infrastructure to commence production of speciality steel.Application from the industry to participate in the scheme will be called for on December 29 and the window will remain open for 90 days till March 31, 2022. State-run Mecon will act as the project monitoring agency for executing the PLI scheme.

The objective of the PLI scheme is to promote manufacturing of speciality steel grades within the country and help the Indian steel industry mature in terms of technology as well as move up the value chain.Coated products, high-strength/wear resistant steel, speciality rails, alloy steel products and electrical steel are the broad five target categories under the scheme.

The government had earlier said that since the scheme is fund-limited, the incentive payable shall not exceed the budgeted allotment for the scheme. Further, the annual incentive payable shall be capped at Rs 200 crore per eligible company including that of group companies or joint ventures across all product categories.“It is expected that the speciality steel production will become 42 million tonne by the end of 2026-27.

This will ensure that approximately 2.5 lakh crore worth of speciality steel will be produced and consumed in the country which would otherwise have been imported. Similarly, the export of speciality steel will become around 5.5 million tonne as against the current 1.7 million tonne of speciality steel getting forex of Rs 33,000 crore,” the government had said.