Production Linked Incentives -II

기사입력 : 2022-01-10 10:10

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Photo=AIR News
Photo=AIR News
Over the past 2 years, India launched Production Linked Incentive (PLI) Schemes for more than a dozen key sectors, which offers great opportunities for Korean companies working in these sectors. Production Linked Incentive or PLI scheme is a scheme that aims to give companies incentives on incremental sales from products manufactured in domestic units. The scheme invites foreign companies to set up units in India and also aims to encourage local companies to set up or expand existing manufacturing units and also to generate more employment.

Amongst the sectors identified for the PLI scheme, the automobile and auto components industry is one of them. The PLI Scheme for Automobile & Auto components and its Guidelines, being undertaken by the Ministry of Heavy Industries(MHI) were published in September 2021. The scheme offers financial incentives to boost domestic manufacturing of Advanced Automotive Technology products and attract investments in the automotive manufacturing value chain. Prime objectives of the scheme include overcoming cost disabilities, creating economies of scale, generating employment, building a robust supply chain in areas of Advanced Automotive Technology products and facilitating the Automobile Industry to move up the value chain into higher value added products. The PLI Scheme for Automobile and Auto Components Industry is expected to get fresh investments of over $5.7 billion, incremental production of over $30 billion and create additional employment opportunities of over 750,000 jobs over the next 5 years.

This Scheme is open to existing Automotive companies as well as new Non-Automotive investor companies (who are currently not in the automobile or auto component manufacturing business). The scheme for Automobile and auto components will be implemented over a period of five years starting from FY 2022-2023. An approved applicant shall be eligible for benefits for 5 consecutive Financial Years and the Financial Year 2019-20 shall be treated as the Base Year for calculation of Eligible sales.

The official portal of the Scheme is All the relevant information such as notifications on Scheme, Guidelines, FAQs, format of Application Form and List of Advanced Automotive Technology Products is available as public information on this portal. All applications are to be submitted through this online portal. The online application form shall be accessible after due registration by the applicant on the portal. The window for receiving

applications are already open with effect from 11th November, 2021 till 9th January, 2022.

An existing automotive company or its Group company(ies)will need to meet the Basic Eligibility criteria to receive incentives. New Non-Automotive Investor company or its Group company(ies)(who are currently not in automobile or auto component manufacturing business) are required to meet the Global Net worth criteria of $134million.The Basic Eligibility criteria are based on audited financial statements for the year ending 31.03.2021. Besides the above eligibility criteria,Minimum New Cumulative Domestic Investment after 01.04.2021 has to be achieved by both the existing automotive companies as well as the New Non-Automotive investor company or its Group company(ies).


The scheme has following components: a) Champion OEM Incentive Scheme: The Champion OEM Incentive scheme is a ‘sales value linked’ scheme, applicable on Battery Electric Vehicles and Hydrogen Fuel Cell Vehicles of all segments and any other Advanced Automotive Technology vehicle prescribed by MHI depending upon technical developments.

b) Component Champion Incentive Scheme:The Component Champion Incentive scheme is a ‘sales value linked’ scheme, applicable on pre-approved Advanced Automotive Technology components of all vehicles, CKD/SKD kits, Vehicle aggregates of 2-Wheelers, 3-Wheelers, passenger vehicles, commercial vehicles and tractors including automobile meant for military use and any other Advanced Automotive Technology components prescribed by MHI depending upon technical developments.

For the Champion OEM incentive scheme, threshold Determined Sales Value for the first year is $ 16.7 million to claim incentives. Similarly,for the Component Champion incentive scheme, threshold Determined Sales Value for the first year is $ 3.3 million to claim incentives. Yearly growth of minimum 10% of the threshold Determined sales value for the first year,and thereafter for next 4 years, has to be achieved to claim incentives. In case the company fails to meet the threshold for Determined sales value in any given year, it will not receive any incentive for that year. However, it will still be eligible to receive the benefits under the scheme in the next year if it meets the threshold of Determined sales defined for that year subject to meeting conditions of Minimum New Domestic Investment for the claim year. Additional incentive of 2% will also be applicable to support high growth achievers. The incentive payable for Champion OEM and New Non-Automotive (OEM) Investor company can range from 13% to 16%. The incentive payable for Component Champion and New Non-Automotive (Component) Investor company ranges from 8% to 11% with an additional 5 % incentive for Battery Electric Vehicles & hydrogen fuel cell vehicle components.

IFCI Limited (Email ID, having its Registered and Head/ Corporate Office at IFCI Tower, 61 Nehru Place, New Delhi – 110019, has been appointed as the Project Management Agency (PMA) for the Scheme. Last date of receiving the application is 9th January, 2022.

The application form for availing the scheme is available at

Frequently asked question related to the scheme is also available at

Indicative Stage-wise Procedural Flow Chart for this PLI scheme is given below under 3 stages:

More information can be found at ;

by Neelam Laitonjam