Context:
Production Linked Incentive (PLI) Scheme for Automobile and Auto Component industry (PLI-Auto) extended by one year.
About PLI-Auto schemes:
- Ministry – Ministry of Heavy Industries
- Purpose: To enhance India’s Manufacturing Capabilities for Advanced Automotive Products (AAT).
- 2 components –
- Champion Original Equipment Manufacturers (OEM)
- Component Champion Incentive Scheme
- Beneficiaries – Both existing automotive companies as well as new investors.
- Incentive –
- Base Year for the calculation of Eligible sales – 2019-20
- A domestic value addition of 50% is mandatory (2% additional incentive)
- Incentives could be claimed only once (either component level or Vehicle level).
- Project Management Agency (PMA) – IFCI Limited (IFCI), a Non-Banking Finance Company.
- Impacts – PLI incentive does not affect benefits under FAME-II for EV manufacturers.
- Recent amendments –
- Tenure extended: Incentive is available for 5 consecutive financial years.
- Level playing field: Failure to achieve a sales value increase results in no incentive for the year. However, the company qualifies for benefits the following year by meeting certain conditions.
About PLI scheme:
- A government initiative in India that offers financial incentives to companies based on their incremental sales of products manufactured in India.
- Aim – To drive domestic manufacturing, spur job creation, bolster exports, facilitate technology transfer, and diminish import reliance.
- 14 Key sectors – mobile manufacturing, manufacturing of medical devices, automobiles and auto components, pharmaceuticals, drugs, specialty steel, telecom & networking products, electronic products, white goods (ACs and LEDs), food products, textile products, solar PV modules, advanced chemistry cell (ACC) battery, and drones and drone components.
- Incentive Rate – Depends on the sector and product category (range from 4% to 6% of incremental sales)
Source: Economic Times
Previous Year Question
Consider, the following statements:
Statement-I : India accounts for 3.2% of global export of goods.
Statement-II : Many local companies and some foreign companies operating in India have taken advantage of India’s ‘Production-linked Incentive’ scheme.
Which one of the following is correct in respect of the above statements?
[UPSC Civil Services Exam – 2023 Prelims]
(a) Both Statement-I and Statement-II are correct and Statement-II is the correct explanation for Statement-I
(b) Both Statement-I and Statement-II are correct and Statement-II is not the correct explanation for Statement-I
(c) Statement-I is correct but Statement-II is incorrect
(d) Statement-I is incorrect but Statement-II is correct
Answer: (d)
Explanation:
For the year 2018 for service sector, India’s share in global exports was 3.5 % and imports was 3.2 %.
