India will support the creation of 8.7 million tons of new capacity for the production of special steel

The government signed relevant memoranda on 85 projects

India has signed memoranda of understanding for 85 special steel projects from 55 companies as part of the third round of its production-linked incentive (PLI 1.2) scheme, according to Observer Voice.

The new round of the PLI scheme, designed to promote local manufacturing and enhance global competitiveness, has attracted investments of approximately $1.3 billion. This move is expected to add 8.7 million tons of special steel capacity per year to the country by fiscal year 2030/2031.

The Indian government sees the PLI scheme as an important initiative to reduce dependence on imports. Minister of Steel and Heavy Industries Sri H.D. Kumarswamy noted that although the country has already made significant progress in the special and alloy steel sectors, new investments are crucial for the state to position itself as a reliable global supplier of high-quality steel products.

PLI 1.2 was launched in November 2025 and covers 22 product subcategories across four main categories.

It should be noted that India reached its target steel production capacity of 205 million tons per year in the 2024/2025 fiscal year. According to a report by MP Financial Advisory Services LLP, the country is confidently moving towards its strategic goal of 300 million tons per year by the 2030/2031 fiscal year. The main challenges for the sector include dependence on coking coal imports (85%), a shortage of scrap, high carbon intensity, and competition from cheap imports.