India’s production-related incentive scheme (PLI) for specialty steel manufacturing has received eight special proposals from Jindal Steel and Power Ltd (JSPL) – the highest of any company; followed by Tata Steel which has submitted proposals in seven categories, said a Union Steel Ministry source.

According to an official, JSPL has committed almost ₹7,930 crore under the scheme through its Odisha-based subsidiary Jindal Steel, Odisha.

Other major steelmakers that have been selected under India’s PLI scheme include JSW Steel – which has applications in six specific steelmaking categories and followed by Arcelor Mittal Nippon Steel (AMNS) which has proposals in four out of eight categories.

The PSU-major SAIL has applications in two special steelmaking categories.

Drive downstream offerings

The official said one of the eight special steelmaking grades JSPL is interested in is API grade hot rolled coil, sheet and plate making, used in oil and gas projects.

Investments have been proposed (by JSPL) towards the manufacture of high tensile sheets, coil and plate manufacture used in the automotive industry, structural fabrication and so on.

Other values ​​of specialty steel manufacturing that will target the automotive industry include cold rolled coated products; and high-end auto-grade steel (also called AHSS or advanced high-grade special steel).

In the downstream segment, there is interest from JSPL and several others to manufacture tin mill products (used cans and food packaging).

There are proposals for investment in: coated and plated products of metallic or non-metallic alloys commonly used in the manufacture of white goods; manufacture of galvalume (a coating consisting of zinc, aluminum and silicon used to protect metals from oxidation) and color-coated steel – both used in roofing; and in consumer durables such as air conditioners and LED lights.

“India’s production of these downstream products is quite low and most of them are imported. Moreover, in sheet steel, there are only four big players namely JSW, AMNS, Tata and SAIL,” said the official.

Increasing imports

India, the world’s second largest producer of raw steel, became a net importer (imports higher than exports) of steel for October and November indicating pressure on the metals cycle, and also due to lower international prices than domestic supply.

October imports were 5,93,000 tons; while in November it was 600,000 tons.

JSW, the country’s largest steelmaker, has raised the issue of imports during its analyst calls. “From a volume perspective, downstream products, we see that imports have increased and most of that is happening in this cold rolled and coated space. We feel it might come out in this quarter (Oct – Dec),” said Jayant Acharya, Deputy MD, JSW Steel.

PLI scheme

The ministry has selected 67-odd applications from 30-odd companies under the PLI Scheme for special steels. The proposal would attract an investment of ₹42,500 crore with an additional 26 million tonnes (mt) of downstream capacity.

The scheme was approved by the Union Cabinet on 22 July-2021, with a five-year financial outlay of ₹6,322 crore. It has received 79 applications from 35 small and large steelmaking companies, committing to an investment of ₹46,000 crore and an additional 28 mt of downstream capacity.

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