Business Desk, ETV Bharat: In order to give India’s manufacturing sector a major boost, the Cabinet on Thursday approved the Production-Linked Incentive (PLI) scheme for 10 key sectors of the economy.
The sectors include automobiles and auto components, electronic/technology products, pharmaceuticals drugs, telecom and networking products, textile products, food products, solar PV modules, white goods, speciality steel and advance chemistry cell (ACC) battery.
Under the scheme, the government has approved financial outlay of up to Rs 1.46 lakh crore over a period of five years. Of this, the automobiles and auto components sector has been assigned the maximum amount of Rs 57,042 crore.
“The PLI scheme across these 10 key specific sectors will make Indian manufacturers globally competitive, attract investment in the areas of core competency and cutting-edge technology; ensure efficiencies; create economies of scale; enhance exports and make India an integral part of the global supply chain,” a government release said.
It added: “The PLI scheme will be implemented by the concerned ministries/departments and will be within the overall financial limits prescribed.”
Industry cheers the move
India’s industrial sector gave a big thumbs up to the government’s announcement. Talking to ETV Bharat, Vinkesh Gulati, president of Federation of Automobile Dealers Associations of India (FADA), said: “The automotive industry is a major economic contributor to India economy. The PLI scheme will make the industry more competitive and will enhance globalization of the Indian automotive sector.”
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“With increasing auto production and the government giving incentives, I am sure the benefits will trickle down to end customers. This will, therefore, help in demand-generation and also in reviving the economy, thereby helping us achieve the goal of becoming a $5 trillion economy.”
Sangita Reddy, President of Federation of Indian Chambers of Commerce and Industry (Ficci), said: “The sectors covered under the PLI scheme are strategic, technology-intensive and also important from the perspective of employment-generation in the country. The Indian economy offers huge opportunity for these sectors not just from the domestic market perspective but also to make India an export hub for these products.”
Notably, the government had earlier in March approved a PLI scheme for large-scale electronics manufacturing in India, which received strong response from big players in the industry.
The scheme proposed production-linked incentives to boost domestic electronics manufacturing. It extended an incentive of 4% to 6% on incremental sales (over base year) of goods manufactured in India and covered under target segments, to eligible companies, for a period of five years.
