The government has approved Production-Linked Incentive (PLI) for 10 sectors including the pharmaceutical industry, textile, and food products. The total allocation under PLI would be Rs 1.46 lakh crore over five years.
An official statement said the PLI scheme across these 10 key specific sectors 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. It said final proposals of the scheme for individual sectors will be appraised by the Expenditure Finance Committee and approved by the Cabinet. Savings, if any, from one PLI scheme of an approved sector can be utilized to fund that of another approved sector by the Empowered Group of Secretaries; any new sector for the scheme will require fresh approval of the Cabinet, the statement said.
“The policy that we are taking in the PLI, through which we want the manufacturers to come into India, is clearly to say we want to build our strength but yet link with the global value chains,” Finance Minister Nirmala Sitharaman said at a press briefing. “India should become a manufacturing hub is always been the call by our honourable prime minister.”
Prime Minister Narendra Modi’s clarion call for an Aatmanirbhar Bharat envisages policies for the promotion of an efficient, equitable and resilient manufacturing sector in the country. Growth in production and exports of industrial goods will greatly expose the Indian industry to foreign competition and ideas, which will help in improving its capabilities to innovate further. Moreover, promotion of the manufacturing sector and creation of a conducive manufacturing ecosystem will not only enable integration with global supply chains but also establish backward linkages with the MSME sector in the country. This will lead to overall growth in the economy and create huge employment opportunities.
MAIT, the apex body which represents India’s ICT sector, has applauded the government’s initiative. Nitin Kunkolienker, President MAIT, welcomed the government’s PLI scheme in making the industry “Aatmanirbhar” and global competitive. He pointed out that the scheme will help the Electronics Industry become a global hub for manufacturing and net exporter which will further make India’s Foreign Exchange net positive. “PLI scheme will make Indian manufacturers global competitive, attract investment in the areas of core competency and cutting-edge technology and create economies of scale. The scheme will also prove to be a strong support system for Indian SME sector and India will see the sector’s growth.” Kunkolienker explained that this will also enhance exports and make India an integral part of the global supply chain.