Govt approves $20 bn support scheme to boost manufacturing
12 November 2020
The union cabinet today gave its approval for expanding the Production-Linked Incentive (PLI) scheme to cover 10 more key sectors, in order to enhance India’s manufacturing capabilities and boost exports, as part of Prime Minister Marendra Modi’s vision of `Atmanirbhar Bharat’ (self-reliant India).
A meeting of the cabinet chaired by Prime Minister Narendra Modi approved a proposal to provide production-linked incentives of about Rs1,45,980 crore (nearly $20 billion) over five years to boost manufacturing in the country and create jobs, finance minister Nirmala Sitharaman said.
Under the expanded PLI scheme, incentives will be given to manufacturers in 10 sectors, including automobiles and auto parts, pharmaceuticals, textiles and food products, to attract investment, Sitharaman said.
The scheme has been designed to ensure that “critical sunrise sectors get necessary support from the government so we are able to build an India which is strong enough to serve the domestic market and link up with the global value chain,” Sitharaman said.
The move is part of India’s effort to create ‘champion’ sectors to attract investment and comes amid calls by Prime Minister Narendra Modi to be self-reliant as a nation.
Under the proposal, the government will give incentives worth Rs57,042 crore to auto and auto parts companies, Rs15,000 crore to the pharmaceutical sector, Rs10,683 crore manufacturers of textile and Rs10,900 core to food products.