To Boost Domestic Manufacturing, Cabinet Approves Rs 26,058 Cr PLI Scheme For Auto And Drone Sector
The cabinet has given a nod to the Production Link Incentive scheme to boost production and create jobs.
New Delhi: After holding a cabinet meeting on Wednesday, the government has cleared a Rs 26,058 crore incentive scheme for the auto industry, auto-component industry, drone industry. The decision was taken in a meeting that was chaired by Prime Minister Narendra Modi.
The production-linked incentive (PLI) scheme approved by the cabinet has been on the cards for a long time and is aimed at promoting domestic manufacturing and creating jobs.
The newly-announced PLI scheme will be effective from FY23 for five years and the base year for eligibility criteria would be 2019-20.
The PLI scheme has a budgetary provision of Rs 26,058 crores - Rs 25,938 crores for the auto sector and Rs 120 crores for the drone industry, announced Union I&B Minister Anurag Thakur.
After announcing the incentives for the Drone industry Anurag Thakur said that the sector is new and is great in demand so it will receive exceptional treatment.
"Speaking of new technology, the PLI scheme has been brought keeping in mind the needs of the present as well as the future, and for local markets too, so that we strengthen our industry", said Anurag Thakur.
He also announced that 'Champion' auto companies will have to make an investment of Rs 2,000 cr of new investments over five years. 2-wheelers & 3-wheelers have to make investments of Rs 1,000 cr over five years and Component makers will have to make investments of Rs 500 cr over five years under the PLI scheme.
The government is expecting from the Auto sector to generate employment for over 7 lakh people through this PLI scheme.
The scheme is also aimed to boost electric vehicles and hydrogen fuel vehicles production in the country.
Thakur further said, " Automobile industry contributes to 35% of the manufacturing GDP of the country. It is a leading sector in generating employment. If we speak of the global automotive trade, then we need to increase India's participation."
The government has slashed the outlay for this PLI scheme to about Rs 26,058 crore from Rs 57,043 crore. The PLI scheme for the automotive industry is a part of the Union Budget for 2021-22, with an outlay of Rs 1.97 lakh crore covering the overall production-linked incentives for at least 13 sectors.
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