The production-linked incentive (PLI) scheme for Mobile Phones and Specified Electronic Components was launched in April 2020, amid the most challenging times of COVID-19 when the Indian economy was reeling under severe difficulties. The objective was to establish India as a hub of electronic manufacturing. It immediately proved a huge success, following which the scheme was further extended to 10 new sectors, and recently there are some more good news.

Early this month, the Union Cabinet approved a PLI scheme for the textiles sector, under which incentives worth Rs 10,683 crore will be provided over five years. It is expected that the move will attract investments of more than Rs 19,000 crore into the sector along with bringing about additional production turnover of over Rs 3 lakh crore and creating employment opportunities of over 7.5 lakh people directly.

Similarly, the Centre has approved a PLI scheme also for promotion of renewable and environment friendly automobiles such as EVs. The government expects that the over Rs 25,000 crore scheme will give a push to the nascent sector. In a similar move, the scheme has also been extended for drones and drone components manufacturing with an allocation of 120 crore spread over three financial years.

Simply speaking, under the scheme companies are rewarded for increasing their output by providing them with incentives tied to incremental investments made during a defined period. Since its launch, the PLI scheme for Mobile Phones and Specified Electronic Components garnered great results for the sector, and based on it, the Centre is now gradually extending the scheme to cover more industries. These steps are welcome.

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