Cabinet sanctions Rs 26,058 crore PLI scheme for auto-drone sectors

16th Sep,2021

Cabinet sanctions Rs 26,058 crore PLI scheme for auto-drone sectors

On Wednesday, the Union Cabinet noded for Rs. 26,058 crore production linked incentive (PLI) scheme for auto, auto-components and drone industries to boost India’s manufacturing capabilities, Union Minister Anurag Thakur said on Wednesday.

The PLI scheme will stimulate the emergence of advanced automotive technologies' global supply chain in India.

The minister told reporters after the Cabinet meeting that incentives worth Rs. 26,058 crore will be given to industry over five years.

It is evaluated that over a period of five years, the PLI scheme for the automobile and auto components industry will lead to fresh investment of over Rs. 42,500 crore, incremental production of over Rs 2.3 lakh crore and will provide additional employment opportunities of over 7.5 lakh jobs, Mr. Thakur said.

The PLI scheme for automobile and drone industries is part of the overall declaration of PLI schemes for 13 sectors made previously during the Union Budget 2021-22, with an outlay of Rs. 1.97 lakh crore.

The scheme for the auto sector foresees overcoming the cost disabilities to the industry for the manufacture of advanced automotive technology products in India.

The incentive structure will motivate industry to make fresh investments for the indigenous global supply chain of Advanced Automotive Technology products, Mr. Thakur said.

The scheme for the auto sector is open to present automotive companies as well as new investors who are currently not in automobile or auto component manufacturing business.

The scheme has two parts - Champion OEM Incentive Scheme and Component Champion Incentive Scheme.

The Champion OEM Incentive scheme is a ‘sales value linked’ scheme, which applies on Battery Electric Vehicles and Hydrogen Fuel Cell Vehicles of all segments, the minister said.

The Component Champion Incentive scheme is a ‘sales value linked’ scheme, applying on Advanced Automotive Technology components of vehicles, Completely Knocked Down (CKD)/ Semi Knocked Down (SKD) kits, vehicle aggregates of 2-Wheelers, 3-Wheelers, passenger vehicles, commercial vehicles and tractors.

The scheme will over a period of three years, lead to investments worth Rs 5,000 crore, a rise in eligible sales of Rs 1500 crore and produce more employment of about 10,000 jobs.