Union Minister of Steel and Heavy Industries H.D. Kumaraswamy will launch ‘PLI scheme 1.1’ for the steel industry and call for applications at an event scheduled to be held at Vigyan Bhavan in the national capital on Monday.
Launched in November 2020, the Steel Ministry’s PLI scheme has attracted a commitment in investment of Rs 27,106 crore, direct employment of 14,760 and estimated production of 7.9 million tonnes of ‘Specialty Steel’ used in the aerospace, defence power and automotive sectors. As of November 2024, companies have already invested Rs 18,300 crore and generated over 8,660 in employment.
“The Ministry of Steel has been interacting regularly with the participating companies and based on feedback, it was felt that there was a scope to notify the scheme again to attract more participation,” according to an official statement issued on Sunday.
The concept of Production-Linked Incentives (PLI) was conceived during the global lockdowns of 2020, emphasising the need to boost domestic manufacturing. Initially launched for three sectors, the PLI scheme was later extended to include steel in November 2020.
The Ministry of Steel is also preparing the ‘Green Steel Mission’ with an estimated cost of Rs 15,000 crore for helping the steel industry to reduce carbon emissions and progress towards the Net Zero Target.
The mission includes a PLI Scheme for Green Steel, incentives for the use of renewable energy and mandates for government agencies to buy green steel to enhance the industry’s environmental sustainability.
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The National Green Hydrogen Mission, spearheaded by the Ministry of New and Renewable Energy, integrates the steel sector into the broader goal of producing and using green hydrogen, contributing to the decarbonisation of steel production.
A report on ‘Greening the Steel Sector in India on the basis of the recommendations of 14 Task Forces constituted by the Ministry of Steel on various key levers of decarbonisation of the steel sector, was released in September this year. This was followed by the release of the Taxonomy of Green Steel for India earlier this month which defines the star rating for green steel. The Steel Scrap Recycling Policy further complements these efforts by increasing the availability of domestically generated scrap, thus promoting resource efficiency, the review states.
The Ministry released the Taxonomy for Green Steel on December 12, 2024, to provide standards for defining and categorizing the low emission steel, facilitating the green transition of the steel industry. It provides a framework for the production of green steel, the creation of a market for green steel and seeking financial support.
The Ministry of New and Renewable Energy (MNRE) has launched the National Green Hydrogen Mission for green hydrogen production and usage. The steel sector is also a stakeholder in the Mission and has been allocated budgetary support of Rs 455 crore for the implementation of pilot projects in the iron & steel sector under the Mission up to the Financial Year 2029-30.
Under this mission, the Ministry of Steel has awarded two Pilot Projects to produce Direct Reduced Iron (DRI) using 100 per cent Hydrogen in the vertical shaft and one Pilot Project to use hydrogen in the existing Blast Furnace to reduce coal/coke consumption in September this year. Pilot projects for the injection of Green Hydrogen in existing vertical shaft-based DRI-making units to partially substitute the natural gas are also being explored.
The government is also formulating a comprehensive global strategy to position India as a leader in the steel industry, capable of meeting domestic needs while also becoming a significant exporter. A Working Group has been constituted to formulate India’s Steel Global Outlook Strategy with a focus on the four strategic areas for collaboration viz. Raw Materials, Investments, Technologies, and Steel Exports. After extensive consultations with the stakeholders, a Strategy Paper will be formulated identifying focused areas of cooperation and action plans for priority countries.
