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Govt approves Rs 2.46 billion PLI incentive for M&M, Tata Motors
Industry News- Jan 03,25
The PLI scheme, launched on September 15, 2021, is designed to strengthen India’s manufacturing capabilities in AAT products, improve cost competitiveness, and develop a robust supply chain.
The Ministry of Heavy Industries has approved a total of Rs 2.46 billion in incentive claims from Mahindra & Mahindra (M&M) and Tata Motors under the Rs 259.38 billion Production-Linked Incentive (PLI) scheme for the automobile and auto components industry. Minister H D Kumaraswamy expressed satisfaction with the progress made by original equipment manufacturers (OEMs) in achieving localised manufacturing, noting the success of initiatives like the PLI scheme. He congratulated both Tata Motors and M&M for their efforts and encouraged more applicants to participate in the scheme.
Tata Motors submitted an incentive claim of around Rs 1.42 billion, based on sales in FY 2023-24. The eligible sales for Tata Motors' Advanced Automotive Technology (AAT) products, including the Tiago EV (electric four-wheeler), Starbus EV (electric bus), and Ace EV (electric cargo vehicle), amounted to Rs 13.8 billion.
Mahindra & Mahindra, on the other hand, claimed Rs 1.04 billion based on incremental sales of AAT products totalling Rs 8 billion for FY 2023-24, with cumulative investments of Rs 9.78 billion. The eligible sales from their electric three-wheeler models, including Treo, Treo Zor, and Zor Grand, reached Rs 8.36 billion, backed by a domestic value addition (DVA) certificate from the Automotive Research Association of India (ARAI).
The PLI scheme, launched on September 15, 2021, is designed to strengthen India’s manufacturing capabilities in AAT products, improve cost competitiveness, and develop a robust supply chain. The scheme operates from FY 2023-24 to FY 2027-28, with disbursements set to occur between FY 2024-25 and FY 2028-29. It offers incentives ranging from 13-18% for electric vehicle and hydrogen fuel cell components, and 8-13% for other AAT components.
As of September 2024, the scheme has already led to an investment of Rs 207.15 billion, resulting in incremental sales of Rs 104.72 billion. The first incentive disbursement is expected in FY 2024-25. The scheme requires aluminimum of 50% domestic value addition and is applicable to both domestic and export sales.
(Business Standard)
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