Centre approves PLI Scheme for Auto & Drone Industry to enhance India’s manufacturing capabilities

Nation

New Delhi, September 15: Union Cabinet chaired by Prime Minister Narendra Modi on Wednesday approved the Production Linked Incentive (PLI) Scheme for Automobile Industry and Drone Industry with a budgetary outlay of Rs 26,058 crore.

“The PLI scheme for the auto sector will incentivize high value Advanced Automotive Technology vehicles and products. It will herald a new age in higher technology, more efficient and green automotive manufacturing,” said Information & Broadcasting Minister Anurag Thakur in a press conference here.

PLI Scheme for Automobile Industry and Drone Industry is part of the overall announcement of PLI Schemes for 13 sectors made earlier during the Union Budget 2021-22, with an outlay of Rs 1.97 lakh crore. With the announcement of PLI Schemes for 13 sectors, minimum additional production in India is expected to be around Rs 37.5 lakh crore over five years and minimum expected additional employment over five years is nearly 1 crore.

It is estimated that over a period of five years, the PLI Scheme for 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 create additional employment opportunities of over 7.5 lakh jobs.

The scheme has two components – Champion OEM Incentive Scheme and Component Champion 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. The Component Champion Incentive scheme is a ‘sales value linked’ scheme, applicable 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 etc.

This PLI Scheme for automotive sector along with the already launched PLI scheme for Advanced Chemistry Cell (ACC) (Rs 18,100 crore) and Faster Adaption of Manufacturing of Electric Vehicles (FAME) (Rs 10,000 crore) will enable India to leapfrog from traditional fossil fuel based automobile transportation system to environmentally cleaner, sustainable, advanced and more efficient Electric Vehicles (EV) based system.

The PLI for Drones and Drone components industry, will over a period of three years, lead to investments worth Rs 5,000 Crore, increase in eligible sales of Rs 1,500 crore and create additional employment of about 10,000 jobs.

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