A scheme announced in the Budget undergoes appraisal, inter-ministerial consultation, fiscal vetting, and often multiple rounds of revision before it receives Cabinet approval. By the time it reaches Cabinet, the size, scope, and beneficiary cohort have often changed materially. What does the appraisal architecture actually do to a scheme between announcement and approval?
The EFC does not merely approve or reject. It reshapes. In India's policy system, schemes are not simply approved; they are re-authored. Fiscal ceilings, strategic priorities, and political economy considerations combine to reshape not just the size of a scheme, but its ultimate beneficiaries.
The Production Linked Incentive scheme for the auto sector was originally announced at ₹57,042 crore covering automobiles broadly. By the time it received Cabinet approval, the outlay had been reduced to ₹25,938 crore and the scope narrowed to Advanced Automotive Technology products, primarily electric vehicles. Conventional ICE vehicles were excluded.
The PLI scheme for High Efficiency Solar PV Modules began with a Tranche I approval of ₹4,500 crore with limited ambition: module manufacturing with partial value-chain support. By September 2022, the Cabinet had expanded the total outlay to ₹24,000 crore and the scope to 65 GW of fully and partially integrated manufacturing capacity. What began as a modest manufacturing incentive was re-authored into one of India's most ambitious renewable energy industrial programmes, more than five times the original allocation.
The PLI scheme for bulk drugs (Key Starting Materials, Drug Intermediates, and Active Pharmaceutical Ingredients) reveals a third trajectory: a scheme where investment exceeds commitment, manufacturing capacity is created, but incentive disbursement lags dramatically. Against 48 approved projects, 34 have been commissioned. Against an investment commitment of approximately ₹3,939 crore, investment worth ₹4,254 crore has been grounded; the industry exceeded its own commitment. But the incentive disbursed stands at ₹21.71 crore. The investment has arrived. The manufacturing capacity exists. The incentive, which is the government's side of the value exchange, moves at the pace of Project Management Agency (PMA) verification, statutory auditor certification, chartered engineer certification, independent field visits, and Empowered Committee approval. A company that has invested, built, and manufactured discovers that the incentive claim process is itself a regulatory journey with its own verification architecture, its own documentation standards, and its own timeline.
A fourth trajectory is captured by the BHAVYA (Bharat Audyogik Vikas Yojna) scheme approved by the Cabinet in March 2026 for developing 100 plug-and-play industrial parks across the country, a scheme that entered the EFC appraisal under the provisional title BAKVY and was renamed in the stage between EFC recommendation and Cabinet announcement. The originating Department for Promotion of Industry and Internal Trade (DPIIT) proposal in December 2024 carried a financial requirement of ₹10,000 crore. The draft EFC Memo circulated in mid-2025 had revised this to ₹24,600 crore. The EFC-recommended outlay that the Cabinet ultimately approved was ₹33,660 crore. The scheme's budget more than trebled through the appraisal process itself, not because the scheme was redesigned but because the cost benchmarks were progressively revised upward as stakeholder consultations expanded the scope; external infrastructure (subject to a 25% ceiling), value-added infrastructure (built-to-suit facilities, common facility centres, storage), and social infrastructure (worker housing) were each defended on substantive grounds, and each addition lifted the per-acre cost anchor from ₹75 lakh in the draft Memo to ₹1 crore in the final scheme. The Department of Expenditure flagged in the second EFC meeting that a uniform ₹1 crore per acre cost applied across hilly and non-hilly states did not appear consistent with the original costing logic; the reassessment did not happen, and the scheme retained the uniform ceiling.
The same scheme carries a second institutional reshaping that is visible only in the EFC record. The 2024-25 Budget Speech had committed the Government of India to developing industrial parks "in partnership with the states and private sector, by better using town planning schemes" (paragraph 52). The Department of Economic Affairs observed at the first EFC meeting that the scheme design before the EFC had made town planning one of several modes of land availability rather than the principal route, and that the proposal did not wholly conform to the spirit of the Budget announcement. The administrative department's response, recorded in the clarification note to the EFC minutes, defended the multi-modal design on grounds of state-level Town Planning Scheme (TPS) capacity, implementation timelines, and the Ministry of Housing and Urban Affairs' own caution that "only land through TPS may narrow down selection and application process." The town planning mandate was lowered from a precondition to a higher-weightage evaluation criterion; the scheme retained its multi-modal design. By the time the scheme reached public announcement in March 2026, town planning had disappeared from the PIB release, the National Industrial Corridor Development Corporation (NICDC) anchoring release, and the Prime Minister's social media communication: what the Budget Speech had originated as the method had become a criterion through appraisal and then disappeared from the public description of the scheme.
The PLI scheme for Bulk Drugs reveals a further institutional adaptation: the reliability filter. Of the products notified under the PLI for Bulk Drugs, eleven remain unsubscribed or partially subscribed, including Erythromycin Thiocyanate, Neomycin, Gentamycin, Clindamycin Base, Streptomycin, Tetracycline, Dicyandiamide, 1,1 Cyclohexane Diacetic Acid, 2-Methyl (5) Nitro Imidazole, Diclofenac Sodium, and Ciprofloxacin. The scheme has an unutilised outlay of ₹1,655 crore. When the Empowered Committee approved reopening the application window, it imposed a specific condition: applicants or their group companies who had previously applied and subsequently withdrew, or whose approval was cancelled owing to non-performance, would not be permitted to apply for the same product again. The system is building behavioural memory into scheme administration; past withdrawal is treated as a disqualifying signal for future applications. The scheme is not merely processing applications; it is evaluating applicant reliability based on institutional track record and encoding that evaluation into eligibility criteria that the original scheme notification did not contemplate.
Four schemes, four different trajectories: one reduced and refocused, one expanded five-fold, one where the outlay trebled through component addition and the originating Budget mandate dissolved through appraisal iteration, and one where the investment arrived and exceeded commitment but the incentive disbursement followed at the system's own institutional pace. The initial number in a Budget announcement or concept note should never be treated as the final fiscal commitment, and the initial beneficiary profile should never be assumed to be the final one. The real scheme, its size, its scope, and its intended beneficiaries, emerges only after the full appraisal machinery has processed the proposal. The company that engages only after Cabinet approval is engaging with a scheme that has already been shaped by others.
The appraisal architecture is not uniformly extractive. A counter-pattern operates alongside the cases where schemes are reduced, diluted, or re-authored against their original intent: some schemes emerge from appraisal substantively stronger than they were announced, and the institutional pattern of how this happens is itself worth naming. The UDAN regional connectivity scheme's design was reshaped during appraisal to include the viability gap funding architecture and the market-based bidding mechanism that are now its central operational features; the original announcement had not specified these. The PM Gati Shakti platform was architecturally redesigned through appraisal to become a genuine inter-ministerial coordination layer with GIS-based integration rather than the dashboard it was originally conceived as. The Ayushman Bharat appraisal introduced the empanelment architecture and the package rate framework without which the scheme could not have operated at scale. The Jan Aushadhi Pariyojana appraisal inserted the generic sourcing requirement and the price ceiling architecture that became its operational identity. The institutional observation is that appraisal is a two-way process. The EFC reduces schemes when the original design does not withstand structural critique, and expands or strengthens schemes when the original design has underspecified the mechanism through which it will actually operate. The appraisal architecture's institutional function is not to preserve the original announcement; it is to compose a scheme that can operate. Where the original announcement was operationally sound, appraisal narrows it against fiscal constraint; where the original announcement was operationally thin, appraisal builds the architecture the scheme needs. The company that engages the appraisal process prepared to let the scheme be strengthened, not merely defended, engages at the institutional stage where the scheme is actually composed.