Brief Context
The Centre has introduced the DMISP Policy – 2025 with a sharp focus on self-reliance and domestic value addition in the steel sector.
Source Content
Syllabus: GS3/ Infrastructure
In News
- The Centre has introduced the DMISP Policy – 2025 with a sharp focus on self-reliance and domestic value addition in the steel sector.
Objective & Significance
- Promote Self-Reliance: The primary goal is to encourage domestic production and consumption of iron and steel, aligning with the “Atmanirbhar Bharat” (Self-Reliant India) vision.
- Curb Imports: The policy seeks to address the rising trend of steel imports, which the government perceives as a threat to the Indian steel sector.
- Protect Domestic Industry: It aims to shield Indian steel manufacturers from foreign competition, particularly in government contracts and infrastructure projects.
- Enhance Domestic Value Addition: The policy also emphasizes increasing the local sourcing of capital goods used in steel manufacturing.
Key Highlights of the DMI&SP Policy–2025
- Preference for Domestic Steel: All government ministries, departments, PSUs, trusts, and statutory bodies must procure locally manufactured iron and steel products.
- Applies to all procurement contracts exceeding ₹5 lakh.
- Covers infrastructure projects under centrally sponsored and central sector schemes.
- “Melt & Pour” Requirement: Products must be melted and poured into solid form within India, ensuring core production happens domestically. Includes flat-rolled products, bars, rods, and railway steel.
- No Global Tenders Under ₹200 Cr: Global Tender Enquiries (GTE) are banned for contracts below ₹200 crore unless explicitly approved by the Department of Expenditure.
- Reciprocal Clause: Suppliers from nations that prohibit Indian firms from participating in their public procurement processes will be barred from bidding in Indian government steel tenders—unless specifically allowed by the Ministry of Steel.
- Aimed at ensuring level playing fields in international trade, with China believed to be a primary target.
- Emphasis on Domestic Value Addition: For capital goods used in steel production (e.g., furnaces, rolling mills), a minimum of 50% domestic value addition is mandatory.
- Bidders must self-certify, with false claims risking blacklisting and forfeiture of earnest money deposits.
- Auditor certification is required for capital goods to verify value thresholds.
Source: BL