Economic Survey | PLI scheme to make India integral part of global supply chain

The Survey said the PLI scheme will ensure efficiencies, create economies of scale, enhance exports, provide a conducive manufacturing ecosystem, and make India an integral part of the global supply chain especially for the 10 sectors identified under the scheme.

The ₹1.46-lakh crore PLI scheme is expected to make India an integral part of the global supply chain and create huge employment opportunities, according to the Economic Survey tabled in Parliament on Friday.

The production-linked incentive (PLI) scheme was recently expanded to 10 sectors, after registering traction from global investors in the mobile manufacturing segment.

The government in the Survey said the scheme will make "Indian manufacturers globally competitive, attract investment in the areas of core competency and cutting-edge technology." It added that the scheme will also establish backward linkages with the MSME sector in the country, which, in turn, "will lead to more inclusive growth and create huge employment opportunities".

The scheme was launched to boost manufacturing in the country and make it self-reliant.

Economic Survey 2021 updates

The Survey said the PLI scheme will ensure efficiencies, create economies of scale, enhance exports, provide a conducive manufacturing ecosystem, and make India an integral part of the global supply chain especially for the 10 sectors identified under the scheme.

Under the scheme, the government has earmarked the highest amount of incentive for the automobile and its components sector amounting to ₹57,042 crore. The mobile sector had been granted an incentive of around ₹40,951 crore.

Some other sectors included under PLI are advance cell chemistry battery (₹18,100 crore), electronic and technology products (Rs 5,000 crore), pharmaceutical drugs (₹15,000 crore), and telecom and network products (₹12,195 crore).

Textile products (₹10,683 crore), food products (₹10,900 crore), high efficiency solar PV modules (₹4,500 crore), white goods (₹6,238 crore) and specialty steel (₹6,322 crore) are also included in the scheme.

The respective ministries of the sectors included under PLI are working on detailed guidelines for rolling out the incentives.

The Ministry of Electronics and IT, which started the scheme, has approved 16 proposals from domestic and international companies entailing an investment of ₹11,000 crore to manufacture mobile phones worth ₹10.5 lakh crore over the next five years.

The companies who have applied for the scheme include iPhone maker Apple’s contract manufacturers Foxconn Hon Hai, Wistron and Pegatron, apart from Samsung and Rising Star.

Domestic companies whose proposals have been approved include Lava, Bhagwati (Micromax), Padget Electronics (Dixon Technologies), UTL Neolyncs and Optiemus.

The mobile phone sector is expected to generate over 2 lakh direct jobs and nearly 6 lakh indirect employment opportunities in the next five years.

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