Cabinet approves PLI scheme worth about Rs 2 lakh Cr: FM
STATE TIMES NEWS
New Delhi: The government on Wednesday approved a Production-Linked Incentive (PLI) scheme for ten key sectors, including telecom, automobiles and pharmaceuticals, taking the total outlay for such incentives to nearly Rs 2 lakh crore over a five-year period.
The scheme will help encourage domestic manufacturing, reduce imports and generate employment as the government works to bolster economic growth. The financial outlay for the new scheme will be Rs 1,45,980 crore.
The five-year PLI scheme, which aims at making Indian manufacturers’ competitive globally, was approved by the Union Cabinet, Information and Broadcasting Minister Prakash Javadekar told reporters here.
Modi hails decision
New Delhi: Prime Minister Narendra Modi on Wednesday hailed the Union Cabinet’s approval to a Production-Linked Incentive (PLI) scheme for ten key sectors, saying it is an important step towards improving India’s competitiveness and realising an ‘Atmanirbhar Bharat’. He also hailed the Union Cabinet’s approval to revamped viability gap funding (VGF) scheme, saying it will boost productive and efficient infrastructure creation and be hugely beneficial to people across the nation.
Lauding the decision, Modi tweeted, “Cabinet decision of PLI scheme for 10 sectors will boost manufacturing, give opportunities to youth while making India a preferred investment destination.”
“This is an important step towards improving our competitiveness and realising an Aatmanirbhar Bharat,” he said.
“Continuation and Revamping of the Scheme for Financial Support to Public Private Partnerships in Infrastructure Viability Gap Funding Scheme will boost productive & efficient infrastructure creation and be hugely beneficial to people across the nation,” Modi said in another tweet.
Elaborating on the decision, Finance Minister Nirmala Sitharaman said the PLI scheme will provide great incentives for manufacturers and help the country move towards the objective of ‘Aatmanirbhar Bharat’ (Self-Reliant India).
The Cabinet also decided to extend the viability gap funding scheme to social infrastructure sectors. The scheme is currently available only for projects concerning economic infrastructure.
“The Cabinet has taken two very important decisions… both of which, if you ask me at a time like this, are going to give a right impetus to the economy, because we are looking at Aatmanirbharta,” Sitharaman said, adding that they will help in making India part of the global value chain. The PLI scheme, she said, will also provide encouragement to the critical sunrise sectors by ensuring necessary support from the government in addition to creating jobs and linking India to global value chain.
The 10 sectors that will be entitled to get the incentives include Advance Chemistry Cell (ACC) battery. It is entitled to get Rs 18,100 crore. Other sectors are electronics and technology products (Rs 5,000 crore); automobiles and auto components (Rs 57,042 crore); pharmaceuticals and drugs (Rs 15,000 crore); telecom and networking products (Rs 12,195 crore); textiles products (Rs 10,683 crore); food products (Rs 10,900 crore); high efficiency solar PV modules (Rs 4,500 crore); white goods (Rs 6,238 crore) and specialty steel (Rs 6,322 crore).
“Over the next five years, this is today estimated, that the new PLIs that we are bingeing in for these 10 identified sectors will involve an expenditure of about Rs 2 lakh crore. So this is something which we are very happy to announce that the Cabinet has given clearance for this…,” Sitharaman said.
An official release said the approved financial outlay over the five-year period for these 10 sectors will be Rs 1,45,980 crore. Under another PLI scheme, an outlay of Rs 51,311 crore has already been approved.
“We are yet again proving that the policy that we are taking up even in PLI through which we want manufacturers to come to India is clearly to say we want to build on our strength but yet link with the global value chains.
“… so this PLI is also aimed at getting investments into the country. The government is giving financal support that these financial incentives will make it attractive to produce in India and selection of sectors have been based on that,” Sitharaman said.
An official release said the scheme across these 10 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.
The PLI scheme will be implemented by the concerned ministries/ departments. The final proposals of PLI for individual sectors will be appraised by the Expenditure Finance Committee (EFC) and approved by the Cabinet.
Savings, if any, from one PLI scheme of an approved sector can be utilised to fund that of another approved sector by the Empowered Group of Secretaries. Any new sector for PLI will require fresh approval of the Cabinet.