8 more sectors set to come under PLI

New Delhi: India will soon extend the production-linked incentive (PLI) scheme to at least eight more sectors to support domestic manufacturing. Those under discussion include battery manufacturing, auto components, network products, textiles, food processing, solar photovoltaic cells, genomics, artificial intelligence, 5G, robotics and drones, a senior government official told ET.“A sector-wise cabinet note has been floated for consideration and a decision to this effect could be taken soon,” the official said. The move is aimed at spurring local manufacturing and promoting India as an alternate global manufacturing hub in Asia.The government believes that the reduced corporate tax rate of 25%, PLI benefits and phased manufacturing plan (PMP) make India an attractive destination. The government has already rolled out a PLI scheme worth ₹50,000 crore for electronics and another ₹10,000 crore for active pharmaceutical ingredients (APIs). Finance secretary Ajay Bhushan Pandey had told ET in an interview that the government is looking to expand the PLI scheme. “We have received some suggestions about whether PLI can be expanded to some more areas. The government will respond, as this scheme is differently designed,” he said.79011440‘Move to Fast-track Atmanirbhar Abhiyan’Pandey added that the programme aims for targeted delivery of incentives, just like DBT (Direct Benefit Transfer).The annual outgo on account of incentives offered under the scheme is likely to be more than ₹50,000 crore. A bulk of it will be directed to sectors such as battery manufacturing, with an estimated outgo of ₹18,000 crore and another ₹4,500 crore for solar photovoltaic cells.“Extension of PLI scheme to more sectors will definitely help in fast-tracking the Atmanirbhar Abhiyan in domestic manufacturing,” said Chandrajit Banerjee, director general of the Confederation of Indian Industry. “Post the pandemic, this will help India enter the global value chain across diverse sectors.”According to Banerjee, the scheme should encourage design-led manufacturing and ensure benefits flow to the micro, small and medium enterprises as well.Under the PLI scheme, the incentives to each sector will be for a five-to-seven year period and the quantum of the incentive will be based on India’s pricing differential vis-a-vis other competing nations in those areas.“The cabinet note covers many sectors of the total 24 sectors where we want to strengthen local manufacturing,” another government official said. More sectors could be added going forward, the official added.The government has identified 24 focus sectors as part of its manufacturing push via the PLI and PMP schemes. These include footwear, ceramics and glass, ethanol, ready-to-eat food, aluminium, gym equipment, toys and sporting goods, drones, robotics and electric vehicle equipment. Of these, a few sectors have been identified as priorities with potential for domestic manufacturing and import substitution through import restrictions and quality control orders such as toys and footwear.

from Economic Times https://ift.tt/329Nhl8