PLI SCHEME FOR ELECTRONICS MAKERS EXTENDED BY A YEAR
Finance minister Nirmala Sitharaman on Monday announced a year’s extension to the production-linked incentive (PLI) scheme for the electronics manufacturing sector. The scheme, which was launched for five years, between 2020-21 and 2024-25, will now be valid up to 2025-26. This gives a breather to the manufacturers who had been impacted due to repeated lockdowns in the last one year. According to the minister, earlier manufacturers were allowed to claim six per cent incentive for incremental manufacturing during the first year, 2020-21.
Finance Minister Nirmala Sitharaman on Monday announced a year’s extension to the production-linked incentive (PLI) scheme for the electronics manufacturing sector. The scheme, which was launched for five years, between 2020-21 and 2024-25, will now be valid up to 202526. This gives a breather to the beleaguered manufacturers who had been impacted due to repeated lockdowns in the last one year.
According to the minister, earlier manufacturers were allowed to claim six per cent incentive for incremental manufacturing during the first year, 2020-21. However, they will now have the option to choose 2021-22 as the first year of the scheme for similar benefits. In either case, 201920 will be considered as the base year to determine the extent of incentives that any manufacturer is entitled to.
The move is aimed at providing relief to companies that could not ramp up their production due to Covid-related disruptions. Apart from lockdowns, restrictions on the movement of goods and personnel along with supply chain bottlenecks delayed their production plans.
“Companies have been unable to meet incremental production conditions. There was disruption in production activities due to pandemicrelated lockdown, restriction on movement of personnel, delay in installation of plant and machinery and disruption in supply chain of components,” said Sitharaman.
According to Rajesh Agarwal, director, Micromax, the extension "offers a muchneeded respite to the industry that is reeling under the impact of the pandemic".
Hari Om Rai, chairman of Lava International, which has availed the scheme for smartphone manufacturing, said it will help in achieving all targets of the PLI like capacity building, job creation and making India a hub for global manufacturing.
“PLI term extension by one more year for mobile phones and electronic components is a big relief for the majority of the approved applicants. The additional one year will enable the applicants to avail the incentive in a more optimum manner and also provide flexibility to firms who have met the current year’s targets,” said Kunal Chaudhary, partner, EY India.
According to Pankaj Mohindroo, chairman of India Cellular and Electronics Association, it will boost the fortunes of sector and help India become an integral part of the global value chain.