The production linked incentive (PLI) scheme for the speciality steel manufacturing is now a step away from cabinet approval, as the expenditure finance committee has cleared it.
CNBC-TV18 has learnt that the Ministry of Steel is in the process of finalising cabinet note with tweaked eligibility criteria, incentive slabs, and other conditions.
The PLI scheme, which has an outlay of Rs 6,322 crore, is being considered to plug import of speciality steel in a bid to boost manufacturing and enhance export capabilities in this segment of steel making.
The ministry has broadly identified five categories and 20 sub-categories for the scheme. The eligibility criteria is likely to include end-to-end manufacturing, including joint ventures and memorandum of understandings (MoU) between companies with 20% value addition by the third parties.
The scheme aims to prioritise companies that will look at front-loading investment along with incremental production annually.
The scheme is likely to begin from FY23 till FY28, with the base year in consideration of FY20. The incentive bracket is likely to be in the range of 4-15 percent, with a clause to cap incentive at Rs 200 crore per company. The incentive will be higher on speciality steel production of API grade and head hardened and asymmetrical rails, followed by mid-range incentive for Tin Mill coated metal products, electro galvanised steel, and then colour coated, aluminum zin coated steel and heat-treated hot rolled steel products.
High-value investment in the scheme is expected from the top steel companies to scale up the manufacturing of speciality steel products. So far, the government has approved PLI schemes under 10 ministries, of which three schemes are on auto components. Textiles and speciality steel are at an advanced stage for cabinet nod.
(Edited by: By Kanishka Sarkar)
First Published: IST