• The government issued operational guidelines for the production linked incentive (PLI) scheme for the pharmaceutical industry to enhance India’s manufacturing capabilities by increasing investment and production in the sector.

• The department of pharmaceuticals has notified the PLI Scheme for Pharmaceuticals, for which the approved outlay is Rs 15,000 crore.

• The scheme envisages to create global champions out of India who have  the potential to grow in size and scale using cutting edge technology and thereby penetrate the global value chains.

• Based on a series of consultations with the pharmaceutical industry and stakeholders in the government, the operational guidelines for the scheme have been prepared and issued on June 1. The scheme is now open to applications from the industry.

• The applications are invited in three categories based on the Global Manufacturing Revenue of FY 2019-20 of the applicants. A special carve-out for MSMEs has been kept under the scheme.

• The products covered under the scheme are formulations, biopharmaceuticals, active pharmaceutical ingredients, key starting material, drug intermediates, in-vitro diagnostic medical devices, etc.

• The category-1 and category-2 products attract 10 per cent incentive and category-3 products attract 5 per cent incentive on the incremental sales.

PLI schemes

An outlay of Rs 1.97 lakh crore has been announced in Union Budget 2021-22 for Production Linked Incentive (PLI) schemes for 13 key sectors for a period of five years starting from FY 2021-22.

These 13 sectors are:

1) Mobile manufacturing and specified electronic components 

2) Critical key starting materials/drug intermediaries & active pharmaceutical ingredients

3) Manufacturing of medical devices 

4) Automobiles and auto components

5) Pharmaceuticals

6) Specialty steel

7) Telecom and networking products

8) Electronic/technology products

9) White goods (ACs and LEDs)

10) Food products

11) Textile products: man-made fibre (MMF) segment and technical textiles

12) High efficiency solar PV modules

13) Advanced Chemistry Cell (ACC) battery.

The objectives of PLI schemes are to make manufacturing in India globally competitive by removing sectoral disabilities, creating economies of scale and ensuring efficiencies.

It is designed to create a complete component ecosystem in India and make India an integral part of the global supply chains. 

The schemes are expected to attract global investments, generate large scale employment opportunities and enhance exports substantially.

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