PLI Auto Scheme Accelerates Investments and Innovations in India's Auto Industry

The government's PLI Auto Scheme has attracted significant investments and created thousands of jobs in India's auto industry. It incentivizes automotive manufacturers who meet investment and domestic value addition criteria. However, stringent measures are planned for firms not meeting their investment commitments under the scheme.

In a push to bolster India's automotive sector, the Production-Linked Incentive (PLI) Auto Scheme has successfully attracted a cumulative investment of Rs 35,657 crore and recorded determined sales of Rs 32,879 crore, creating nearly 49,000 jobs up to September 2023. The Heavy Industries Ministry confirmed these numbers, showcasing the scheme's significant industry impact.

The implementation of the scheme involves a budgetary outlay of Rs 25,938 crore, with incentives offered to those entities meeting specified criteria including investment levels and domestic value addition (DVA). Top-tier automotive companies such as Tata Motors and Mahindra & Mahindra have already benefited, receiving Rs 1,999.94 crore in incentives for the 2024-25 performance year.

Yet, not all progress is smooth, as the government plans to invoke bank guarantees of ten companies that failed to make any investments. The scheme covers a five-year performance period, during which only products achieving a minimum of 50% DVA get incentivized. Furthermore, a plan for deploying 72,000 electric vehicle chargers across India is in place under the PM-EDRIVE initiative.

(With inputs from agencies.)