Production Linked Incentive or PLI scheme
- Production Linked Incentive or PLI scheme is a scheme that aims to give companies incentives on incremental sales 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.
- It was launched in April 2020, for the Large-Scale Electronics Manufacturing sector, but later towards the end of 2020 was introduced for 10 other sectors.
- This scheme was introduced in line with India’s Atmanirbhar Bharat
Sectors Covered
- Advanced Chemistry
- Automobiles
- & Auto Components
- Pharmaceuticals drugs
- Telecom & Networking Products
- Textile Products:
- Food Products Ministry of Food Processing Industries
- High-Efficiency Solar PV Modules
- White Goods (ACs & LED)
- Speciality Steel
Targets:
- The government aims to make India an integral part of the global supply chain and enhance exports
- India is expected to have a USD 1 trillion digital economy by 2025 as it expects the demand for electronics to increase under its projects like Smart City and Digital India
- The PLI scheme will make the Indian automotive Industry more competitive and will enhance the globalisation of the Indian automotive sector
- The Indian Textile Industry is one of the largest in the world and with this scheme, it shall attract large investment in the sector to further boost domestic manufacturing, especially in the manmade fibre (MMF) segment and technical textiles
- India, being the second-largest producer of steel in the world, introducing it under the PLI scheme will benefit the country as it may expand export opportunities
- Similarly, telecom, solar panels, pharmaceuticals, white goods, and all the other sectors introduced can contribute to the economic growth of the country and make India a manufacturing hub globally