In a significant move to accelerate the progress of the Production Linked Incentive (PLI) scheme for specialty steel, India's Steel Ministry has streamlined the visa approval process for Chinese technicians and experts. These professionals are critical for the installation, maintenance, and training related to specialised steel-making equipment, much of which is supplied by China. This initiative aims to address delays that have hampered the implementation of the PLI projects.
An official from the Steel Ministry revealed that visa recommendations for Chinese experts are now being approved within seven days, a marked improvement from previous months. This expedited process follows numerous delays attributed to India-China visa issues, which have significantly slowed down the execution of PLI schemes.
The PLI scheme for specialty steel has seen 57 Memorandums of Understanding (MoUs) signed, promising an investment of Rs 29,500 crore and an additional capacity of 25 million tonnes by FY28. Despite the initial slow start, the sector has witnessed substantial investment, with Rs 12,900 crore already injected into the projects by December 2023. An additional Rs 10,000 crore is expected to be invested in FY25.
The revised expected investment for FY24 was Rs 16,000 crore, but actual investments fell short at Rs 14,500 crore. Initially, companies had committed Rs 21,000 crore last fiscal year, indicating a substantial gap due to delays. To mitigate such issues, the Ministry has implemented measures to expedite project clearances and standardise visa procedures for foreign experts.
A notable challenge highlighted during industry meetings is the dependency on imported precision equipment necessary for specialty steel production. The import content and value tend to rise as the steel production moves up the value chain. It is estimated that around USD 18-20 billion worth of imported equipment will be needed, alongside spares valued at USD 400-500 million.
In response to these challenges, Ministry officials have advocated for a consortium-based approach to develop high-end capital goods domestically. They argue that self-reliance in the steel sector and reduced imports are essential for maintaining global competitiveness. The government has pledged support, including facilitating Intellectual Property Rights (IPRs) and potentially providing financial assistance, to encourage the development of these technologies in-house.
An official emphasised the importance of this initiative, stating, "Indian steel companies must start producing their own capital equipment. Reliance on imports is unsustainable. Collaboration between private and state-owned entities, with government support, can foster the development of these critical technologies."
As the Steel Ministry fast-tracks visa approvals and addresses key industry challenges, the PLI scheme for specialty steel is expected to gain momentum. The focus on developing domestic capabilities and reducing import dependencies is crucial for the sector's long-term growth and competitiveness.
