Regulatory Updates0Production Linked Incentive (PLI) Scheme


Production Linked Incentives (PLI) is an outcome and output-oriented scheme spanning across 10 sectors, which gives companies incentives on incremental sales (over FY 2019-20) from products manufactured in domestic units. The scheme invites foreign companies to set up units in India, However, it also aims to encourage local companies to set up or expand existing manufacturing units and also to generate more employment and cut down the country’s reliance on imports from other countries. The scheme 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.

  • ACC (Advance Chemistry Cells) battery manufacturing represents one of the largest economic opportunities of the twenty-first century for several global growth sectors, such as consumer electronics, electric vehicles, and renewable energy. The PLI scheme for ACC battery will inceltivize large domestic and international players in establishing a competitive ACC battery set-up in the country. Approved Financial outlay: Rs 18100 Cr
  • India is expected to have a USD 1 trillion digital economy by 2025. Additionally, the Government’s push for data localization, Internet of Things market in India, projects such as Smart City and Digital India are expected to increase the demand for electronic products. The PLI scheme will boost the production of electronic products in India. Approved Financial outlay: Rs 5000 Cr
  • The automotive industry is a major economic contributor in India. The PLI scheme will make the Indian automotive Industry more competitive and will enhance globalization of the Indian automotive sector.Under the PLI scheme, four plans for the automotive sector have been proposed : sourcing incentive scheme, champion OEM incentive scheme, logistic cost linked incentive scheme, and component champion incentive scheme. Selected Automotive champions will be eligible for a maximum of three of the four schemes and total incentive per company would be capped at Rs 8,556 crore. The scheme has set ambitious targets on investment with expectation that PLI would result in additional investment of over Rs 1 lakh crore over a five year period with potential for additional employment generation of 58.84 lakh jobs. Approved Financial outlay: Rs 57,042 Cr
  • The Indian pharmaceutical industry is the third largest in the world by volume and 14th largest in terms of value. It contributes 3.5% of the total drugs and medicines exported globally. India possesses the complete ecosystem for development and manufacturing of pharmaceuticals and a robust ecosystem of allied industries. The PLI scheme will incentivise the global and domestic players to engage in high value production. Approved Financial outlay: Rs 15,000 Cr  
  • Telecom equipment forms a critical and strategic element of building a secured telecom infrastructure and India aspires to become a major original equipment manufacturer of telecom and networking products. The PLI scheme is expected to attract large investments from global players and help domestic companies seize the emerging opportunities and become big players in the export market. Approved Financial outlay: Rs 12,195 Cr
  • The Indian textile industry is one of the largest in the world and has a share of ~5% of global exports in textiles and apparel. But India’s share in the manmade fibre (MMF) segment is low in contrast to the global consumption pattern, which is majorly in this segment. The PLI scheme will attract large investment in the sector to further boost domestic manufacturing, especially in the MMF segment and technical textiles. Financial outlay: Rs 10,683 Cr
  • The growth of the processed food industry leads to better price for farmers and reduces high levels of wastage. Specific product lines having high growth potential and capabilities to generate medium- to large-scale employment have been identified for providing support through the PLI scheme.Financial outlay: Rs 10,900 Cr
  • Large imports of solar PV panels pose risks in supply-chain resilience and have strategic security challenges considering the electronic (hackable) nature of the value chain. A focused PLI scheme for solar PV modules will incentivize domestic and global players to build large-scale solar PV capacity in India and help India leapfrog in capturing the global value chains for solar PV manufacturing. Financial outlay: Rs 4,500 Cr
  • White goods (air conditioners and LEDs) have very high potential of domestic value addition and making these products globally competitive. A PLI scheme for the sector will lead to more domestic manufacturing, generation of jobs and increased exports. Financial outlay: Rs 6,283Cr
  • Speciality Steel is a strategically important industry and India is the world’s second largest steel producer in the world. It is a net exporter of finished steel and has the potential to become a champion in certain grades of steel. A PLI scheme in Specialty Steel will help in enhancing manufacturing capabilities for value added steel leading to increase in total exports. Financial outlay: Rs 6,322 Cr
 How to apply for benefits under the PLI Scheme

The application process is set out below:

  1. Application can be made by any company registered in India.
  2. The number of applications allowed per applicant for support under the Scheme shall be restricted to 1.
  3. Project Management Agency (PMA) / MeitY to receive the application (through an Online Portal) for prima facie examination and issue acknowledgement within 15 days post completion of examination.
  4. Each application shall be reviewed and details shall be entered in the detailed checklist by the PMA upon receipt of the application.
  5. The PMA will accordingly make appropriate recommendations to the Technical Committee (TC) for approvals under the Scheme.
  6. The final recommendations of the PMA and the Technical Committee shall be placed before Empowered Committee (EC) for its approval.
  7. All the applications shall be finalized within 60 days from the date of issuance of acknowledgement of receipt of the application.
  8. An approval letter to the applicant will be sent within 5 working days of receiving approval from the Competent Authority.

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