The Central Government has unveiled a PRODUCTION LINKED INCENTIVE SCHEME to encourage domestic manufacturing investments in 10 More Sectors with an estimated outlay of about Rs1.46 Lakh Crore over the next Five Years. These Sectors have been identified on the basis of their potential to create employment and make India Self-Relian

1. Production Linked
Incentive
Scheme

2.  The Central Government has unveiled a
PRODUCTION LINKED INCENTIVE SCHEME
to encourage domestic manufacturing
investments in 10 More Sectors with an
estimated outlay of about Rs1.46 Lakh Crore
over the next Five Years.
 These Sectors have been identified on the basis
of their potential to create employment and
make India Self-Reliant.
Context :

3. About Production Linked Incentive Scheme (PLI)
PLI
In March, this year, the
central government
introduced PLI, in order to
boost domestic
manufacturing and cut down
on import bills.
INCENTIVES
4% -6% Production linked
incentive for a period of five
year.
TENURE
Five Years
Application Period
4 Months initially
BASE YEAR
Financial year
2019-2020
APPLICABILITY
Incentives Applicable From
1st August, 2020
ELIGIBILITY
1. The number of
applications allowed
per applicant for
support under the
scheme shall be
restricted to one.
2. Subject to thresholds of
incremental investment
and incremental sales of
manufacture goods.
EMPOWERED
COMMITTEE
CEO NITI Aayog
Secretary Economic
Affairs
Secretary Expenditure
Secretary MeitY
Secretary Revenue
Secretary DPIIT
DGFT
TARGET SEGMENTS
Mobile Phones and
specified electronic
components

4. The 10 Sectors Include :

5. Incentive Outlay
Total Incentive:
The expected annual incentive
outlay and cumulative incentive
outlay under the Scheme is as follows:
Incentive Per Company:
The incentive per company will
be applicable on incremental sales
of manufactured goods (as distinct
from traded goods) over base year
subject to ceilings as decided by
the Empowered Committee.
Financial Year Total Incentive
Year 1 5,334
Year 2 8,064
Year 3 8,425
Year 4 8,425
Year 5 7,640
Total 40,951

6. Advance Chemistry Cell (ACC)
Advance Chemistry Cells (ACCs) are the new generation
advance storage technologies that can store electric energy
either as electrochemical or as chemical energy and covert
it back to electric energy as and when required. With the
view to bolster the manufacturing capabilities of the
country and enhance exports, the Union Cabinet approved
production-linked incentives (PLI) in 10 key sectors
including Advanced Chemistry Cell (ACC) battery, under
the Atmanirbhar Bharat vision. ACC battery has been
approved a financial outlay of INR 18,100 crores. The PLI
scheme for the ACC battery sector is expected to
incentivize large domestic and international players in
establishing a competitive ACC battery set-up in the
country. In the auto sector, the PLI scheme aims to make
the Indian automotive industry more competitive and
enhance the globalization of the automotive sector through
the latest incentives

7. Electronic/Technology Products
Electronic and technology products To be implemented by Ministry of
Electronics and Information Technology, the PLI scheme for electronic
or technology products include semiconductor fab, display fab, laptops,
servers, IoT devices and specified computer hardware, with an
approved financial outlay of Rs 5,000 crore over a five-year
period."The Indian government's decision to introduce PLI for laptops
is timely and in the right direction. We are confident that it will
encourage local manufacturing and further bolster the local PC market,
which is already seeing a positive momentum under the current work
and learn from home scenarios.

8. Automobiles & Auto Components
Automobile industry welcoming the announcement by
the government to give Rs 2 lakh crore worth
production-linked incentives for 10 sectors to boost
domestic manufacturing, This step will also make the
Indian auto industry more competitive globally, improve
export and will make production better in economies of
scale. Automobiles and Auto components have been
approved INR 57,042 crores.

9. Pharmaceuticals drugs
In March this year, the government announced two PLI schemes for
encouraging domestic production of active pharmaceutical ingredients (API)
and medical devices. The government replaced the term „minimum threshold‟
investment with „committed‟ investment, taking into account availability of
technology choices which varies from product to product. The net worth of the
firm on the date of application should not be less than 30 per cent of the
committed investment. Under the scheme for bulk drugs, as many as 53 active
pharmaceutical ingredients used for making 41 drugs including penicillin G,
Atorvastatin, Telmisartan, Diclofenac Sodium and many vitamin supplements
are covered. Under the PLI scheme for bulk drugs, those projects that intend
to produce fermentation-based products will get 20 per cent incentive for four
years beginning 2023-24 and it will subsequently taper off to 15 per cent and 5
per cent, respectively in the next two years. or those engaged in
manufacturing chemically synthesised bulk drugs, the incentive scheme
commences a year early from 202-23, even though it also runs for six years
during which the firms will get 10 per cent incentive annually.

10. Telecom & Networking Products
For the telecom sector, which has an outlay of Rs 12,195 crore,
the PLI scheme will support the manufacturing of 4G, 5G,
next generation radio access network and wireless equipment.
This comes at a time when many countries in the world are
trying to limit the influence and involvement of Chinese
companies in the 5G ecosystem. India is currently working
with Japan, the United Kingdom, with support from the
United States, Australia and so on, to develop 5G and 5G Plus
technologies. Additionally, the manufacturing of Internet of
Things (IoT) access devices and enterprise equipment such as
routers and routers will be supported.

11. Textile Products: MMF segment and technical textiles
The scheme provides incentives for manufacture and
export of specific textile products made of man -made
fibre (MMF).According to chairman of Southern India
Mills‟ Association Ashwin Chandran, the Indian textiles
industry has a huge potential for employment creation
and boosting exports. It has been allocated Rs 10,683
crores focusing on MMF apparel and technical textiles.
Though India can become a major player in cotton
textiles and exports, it has been lagging behind in the
MMF textile trade due to expensive raw material and
high tariff barriers, apart from cheaper imports from
neighbouring countries.

12. Food Products
Bringing food processing industry under the PLI scheme
would “Revolutionise” the sector. India processes only 7% of
the total farm producer despite being world‟s leading
producer of fruits, vegetables and milk. “The PLI scheme
would help attracting more investment into the sector, both
domestic and foreign investment.” The allocation made by
the government for the sector is Rs 10,900 crore, and would
cover ready to eat food products, marine products, fruits
and vegetables, honey, ghee, mozzarella cheese, organic eggs.

13. High Efficiency Solar PV Modules
The Union Cabinet‟s decision to award „performance
linked incentive‟ (PLI) to solar panel manufacturers
is likely to give a boost to the domestic companies.
The sector is still nascent in India and the
government wants to reduce import dependence.
Large imports of solar photovoltaic (PV) panels pose
risks in supply-chain resilience and have strategic
security challenges considering the electronic
(hackable) nature of the value chain.

14. White Goods (ACs & LED)
PLI scheme will help set up local manufacturing facilities
for appliances like air conditioners as also products like
LED lights. The Cabinet approval to the production-linked
incentive (PLI) scheme on November 11 is expected to
provide a boost to local manufacturing of white goods in
India. Industry body CEAMA (Consumer Electronics and
Appliance Manufacturers Association) said the domestic
manufacturing will also help generate employment in the
appliances industry. The size of the white goods industry in
India is estimated to be Rs 80,000 crore.

15. Speciality Steel
Steel industry welcome the move of Government of India in
extending PLI scheme to speciality steel products. This will
enable the steel industry to attract fresh investment and state of
the art technology that would make India self-reliant in
producing value-added speciality steel products “The scheme
allocates Rs 6,322 crore for incentivising production of specialty
steel. India, a net exporter of finished steel, has the potential to
become a champion in certain grades of steel, the government
said in a statement. The PLI scheme will help in enhancing
manufacturing capabilities for value-added steel leading to
increase in total exports. The scheme will prove to be a
gamechanger help achieving the goal of India becoming a
champion in certain grades of steel while enhancing
manufacturing capabilities for value-added steel leading to
increase exports

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