Production Linked Incentive Scheme (PLI)

Production Linked Incentive Scheme (PLI)

Why in News?

  • Recently, India has recognized a strategic opportunity to establish itself as a key player in the global value chains

Highlights

  • The manufacturing industry’s positive response to the Production Linked Incentive scheme (PLI) is likely to upgrade the labor force’s skills, replace old machinery, enhance production volumes and make logistics and operations efficient, giving India a chance to become a key manufacturing player.
  • The Indian government’s introduction of the PLI scheme in 14 key manufacturing sectors is a significant step towards achieving its strategic vision for the manufacturing industry.
  • With a budget of ₹1.97 lakh crore, the scheme is well-designed to encourage growth and sustainability in the targeted industry through various incentives and support measures.
  • The 14 sectors are mobile manufacturing, manufacturing of medical devices, automobiles and auto components, pharmaceuticals, drugs, specialty steel, telecom & networking products, electronic products, white goods (ACs and LEDs), food products, textile products, solar PV modules, advanced chemistry cell (ACC) battery, and drones and drone components. The Incentives given, are calculated on the basis of incremental sales.
  • In some sectors such as advanced chemistry cell batteries, textile products and the drone industry, the incentive to be given will be calculated on the basis of sales, performance and local value addition done over the period of five years.
  • The emphasis on R&D investment will also help the industry keep up with global trends and remain competitive in the international market
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