Production Linked Incentive (PLI) Scheme for IT Hardware

The Union Cabinet approved an updated Production Linked Incentive (PLI) scheme for IT hardware manufacturing, with the total budgetary outlay more than doubled to ₹17,000 crore.

18 May 2023

Context: 

The Union Cabinet approved an updated Production Linked Incentive (PLI) scheme for IT hardware manufacturing, with the total budgetary outlay more than doubled to ₹17,000 crore.

New updates in the Scheme:

  • The incentive had been increased to 5%. 
  • An “additional op­tional incentive” has also been introduced for using domestically produced components. However, rates of these optional incentives are not specified yet.

PLI Scheme for IT Hardware:

  • Launch year: 2021.
  • Target Segments:  Laptops, Tablets, All-in-One PCs and Servers.
  • Rate of incentives: The Scheme shall extend an incentive of 4% on net incremental sales (over base year i.e. 2019-20) of goods manufactured in India and covered under the target segment, to eligible companies, for a period of four years.
  • Funding: The total cost of the scheme is approximately Rs.7,350 crore over 4 years, which includes an incentive outlay of Rs.7,325 crore and administrative charges of Rs.25 crore
  • Employment: The scheme has an employment generation potential of over 1,80,000 (direct and indirect) over 4 years.
  • Value Addition: The scheme will provide impetus to Domestic Value Addition for IT Hardware which is expected to rise to 20% – 25% by 2025.

Key Points on Electronics Manufacturing:

  • Electronics manufacturing in India has witnessed consistent growth with 17% CAGR in the last 8 years.
  • This year it crossed a major benchmark in production- $105 billion.
  • Telecom hardware manufacturing had exceeded the projected ₹900 crore and reached ₹1,600 crore.
  • India crossed $11 billion in mobile phone exports, and was now the second largest mobile handset maker behind China.

News Source: The Indian Express

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UDAAN PRELIMS WALLAH
Comprehensive coverage with a concise format
Integration of PYQ within the booklet
Designed as per recent trends of Prelims questions
हिंदी में भी उपलब्ध

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