Six Thinking Hats

PLI?
PRODUCTION LINKED INCENTIVE

SCHEME
• Government of India scheme to boost domestic manufacturing and cut
down import bills.
• A scheme that aims to give companies incentives on incremental

sales from products manufactured in domestic units.

• Part of Atmanirbhar Bharat campaign by Nirmala Sitharaman on
April 2020.
Objectives of PLI
1.To encourage local companies.
2.Expand existing units.
3.Generate more employment.
4.Cutdown country’s reliance on imports.
Production linked incentive scheme
• The production linked incentive scheme was first introduced in March 2020 as
an initiative that provide incentive to domestic industries to boost local
production.
• The first sector which the PLI scheme had targeted was the large-scale
electronics manufacturing in April,2020 and by the end of the year 10 more
sector was included
• In the union budget 2021, Finance Minister mentioned an Inclusion of 13
more sector and Rs. 1.97 lakh crore have been allocated for this scheme.
• Incentive – 4%to 6%production linked incentive
• Target segments- Mainly mobile phones and specified electronic components.
…..
1. Large scale Electronics Manufacturing
• Total cost proposed for this scheme was INR 40,995 crore.
• The scheme can help employ over 2 lakh people in 5 year.
• The production of mobile phone has gone up significantly from around INR
18,900 Crore in 2014-15 to INR 1,70,000 crore in 2021-22.
2. Pharmaceuticals
• Total incremental sales of Rs.2,94,000 crore and total increment export of Rs.
1,96,000 crore are estimated during six year from 2022-23 to 2027-28
• Expected to generate employment 20,000 direct and 80,000 indirect jobs as a
result of Growth in this sector.
Production-linked incentive scheme
• The scheme shall extend an incentive of 4% to 6% on incremental sales (over

base year) of goods manufactured in India and covered under target segments,
to eligible companies, for a period of five (5) years subsequent to the base
year as defined.
• According to the PLI scheme update in November 2020, the scheme aimed to
include ten more labour intensive sectors of production—examples
include food processing, textiles etc. in addition to the already existing
sectors like allied equipment for mobile phones and assembly, pharma and
medical devices.
HOW SUCCESFULL IS PLI SCHEME?
• The PLI scheme has the potential to add
nearly 4 per cent to GDP per annum in
terms of incremental revenue if fully
realized, the report released on Tuesday
said. Manufacturing companies are
adding capacities due to robust returns
and this is evident from the number of
new manufacturing companies registered.
Production linked incentive scheme
• As the COVID-19 pandemic hit the world economy, the importance of

being ‘Atmanirbhar’ came into focus. The Prime Minister pointed out
that the only way for India was through local industries. To create jobs
and get rid of India’s unemployment plague, it is imperative that the
domestic manufacturing sector be boosted.
……..
• To make India a manufacturing hub, the government recently
announced the PLI scheme for mobile phones, pharma products, and
medical equipment sectors
• All electronic manufacturing companies which are either Indian or

have a registered unit in India will be eligible to apply for the scheme.
• These companies can either create a new unit or seek incentives for
their existing units from one or more locations in India.
PRODUCTION LINKED INCENTIVE
SCHEME
• extend an incentive of 4% to 6% on incremental sales (over base year) of
goods manufactured in India
• Support under the Scheme shall be provided for a period of five (5) years
subsequent to the base year
• The main motive is to position India as a global hub for Electronics System
Design and Manufacturing (ESDM) by encouraging and driving capabilities in
the country for developing core components and creating an enabling
environment for the industry to compete globally.
• to boost domestic manufacturing and attract large investments in mobile
phone manufacturing and specified electronic components, including
Assembly, Testing, Marking and Packaging (ATMP) units.
BLACK HAT
PRODUCTION LINKED INCENTIVE SCHEMES
• The effective cost of manufacturing is

higher than competitors in PLI Scheme-
focused sectors.
• Problem of Cheap imported material

……..
• Less presence of domestic firms
• Lack of cutting edge technology and Foundries
• Scheme contains a financial cap on incentives

Outcomes
• Focus on services industry.
• Reduction in costs.
• Encouraging states to be competitive.
• Profiting from anti Chinese sentiments.
• Global manufacturing hub of International companies.
Thank you
Gayathrii krishna
Rekha kumari
Rohith kumar reddy
Yelamarthi Bhargav
Aheli
Aditya

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PLI?

PRODUCTION LINKED INCENTIVE

• A scheme that aims to give companies incentives on incremental

• The scheme shall extend an incentive of 4% to 6% on incremental sales (over

• As the COVID-19 pandemic hit the world economy, the importance of

• All electronic manufacturing companies which are either Indian or

• The effective cost of manufacturing is

• Problem of Cheap imported material

• Less presence of domestic firms

• Lack of cutting edge technology and Foundries

• Scheme contains a financial cap on incentives

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