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India plans sector-specific revisions to boost utilisation of $24 bn industrial incentives
Industry News- Nov 14,23
Proposed modifications are targeted at the textiles, pharmaceuticals, drones, solar, and food processing industries, constituting nearly one-third of the PLI scheme.
India is set to revise and broaden certain regulations in five key sectors to optimise the utilisation of its $24 billion industrial incentives aimed at fostering local manufacturing, according to two government officials.
The production-linked incentive scheme (PLI), valued at 1.97 trillion rupees and initiated in 2020, spans 14 sectors, from electronics to drones. However, its success has been limited in several areas, prompting a re-evaluation.
Proposed modifications are targeted at the textiles, pharmaceuticals, drones, solar, and food processing industries, constituting nearly one-third of the PLI scheme.
In the textile sector, the government plans to encompass additional products like man-made fiber and grant companies an extra year to meet manufacturing targets necessary for claiming incentives. Similarly, the pharmaceuticals sector will witness a one-year extension, and the financial allocation for drone production incentives will increase from the current 1.2 billion rupees to 3.3 billion rupees.
For the food processing sector, the scheme will be extended to include millet-based products. Additionally, the production of ingots and wafers will be incorporated into the solar module sector's incentive scheme.
The Ministry of Commerce and Industry, responsible for overseeing the scheme's implementation, is in discussions with other federal departments regarding these changes, according to the officials who preferred not to disclose their names as details of the discussions have not been publicised.
The trade ministry has not responded to an emailed request for comment. The officials clarified that the contemplated changes do not necessitate a fresh financial allocation but will tap into the scheme's existing savings.
Notable companies participating in the food processing incentive schemes include Hindustan Unilever Ltd, ITC Ltd, Nestle India Ltd, and Britannia Industries Ltd. Meanwhile, Reliance Industries, JSW Energy, and Tata Power are among the companies involved in the solar module manufacturing incentive scheme.
Given that only a fraction of the PLI incentives has been claimed thus far, the government is exploring options to allocate unused funds, including considering the inclusion of new sectors within the scheme.
Source: Indiatimes
India
PLI scheme
Ministry of Commerce and Industry
Hindustan Unilever
ITC Ltd
Nestle India
Britannia Industries
Reliance Industries
JSW Energy
Tata Power
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