India's PLI Makeover Opens Doors for Textiles, Food, and Pharma

The Indian government has initiated modifications to the production-linked incentive (PLI) schemes for textiles, food processing, and pharmaceuticals. These adjustments aim to enhance the attractiveness of these sectors for companies participating in the PLI program.

This strategic move is crucial as certain sectors, including electronics, pharmaceuticals, food processing, and telecom, have experienced significant benefits from PLI schemes, while others have underperformed. Recognizing the need for a course correction, the government seeks to stimulate more investments in these specific sectors. The PLI scheme, amounting to Rs 1.97 lakh crore, was introduced in 2021, encompassing 14 sectors such as telecom, white goods, textiles, pharma, medical devices, automobiles, specialty steel, food products, high-efficiency solar PV modules, advanced chemistry cell batteries, and drones.

Up until October, Rs 4,415 crore has been disbursed under the scheme for eight sectors, including electronics and pharma. In the fiscal year 2024, expenditure totaled Rs 1,515 crore by October, compared to Rs 2,900 crore in the previous fiscal year. The Department for Promotion of Industry and Internal Trade (DPIIT) has approved 746 applications across the 14 sectors, anticipating an investment exceeding Rs three lakh crore. Notably, 176 micro, small, and medium enterprises (MSMEs) have benefited from the PLI program in the pharma and telecom sectors.

As of November 2023, reported investments surpassing Rs 1.03 lakh crore have resulted in production and sales amounting to Rs 8.61 lakh crore, contributing to the creation of over 678,000 jobs. Approximately 1,000 units are currently operating under the PLI scheme.

News by Rahul Yelligetti