Phone makers urge Govt to push timeline of PLI scheme by a year

Mobile manufacturers have urged the government to push the five-year production-linked incentive (PLI) scheme timeline by a year and consider the current fiscal as zero year due to Covid-19-led disruptions that dragged the production output behind stipulated targets. The India Cellular and Electronics Association (ICEA) has written to the government suggesting that FY 2020-21 should be treated as a year of preparation, but no incentive should be given for any incremental production this year. “Incentives should start from the financial year FY 2021-22 and end in the year FY 2025-26 instead of FY 2024-25, with no other change in the scheme, keeping the yearly expenditure envelope unchanged,” ICEA said in a letter dated March 4. It added that investments done so far must be cumulated with those made in FY22 to be considered for first year targets.

ICEA said, “Any company (read: Samsung) that has achieved both investment and revenue targets during the current financial year due to their ability to exploit existing facilities, production lines, or having been established in India for a long time, should be given the incentives as per the current scheme.” The rest 15 manufacturers namely Hon Hai, Rising Stars, Wistron, Pegatron besides Indian makers Dixon, Lava, Optiemus, UTL, Bhagwati and component makers Sahasra, AT&S, Neolync, Visicon, Walsin and Ascent

Circuits have failed to meet production targets. The Centre has earmarked a combined incentive package of Rs 5,334 crore for year one. The industry body cited various reasons for companies’ distress such as shortage of chipsets, the 45-day lockdown in India, short span of 6 months given to expand capacity, non-availability of technical specialists from abroad due to constraints on their business visas etc. “We have come to know that the suppliers have cut supplies to our Indian companies by 97% in certain cases,” ICEA said.n