• The operational guidelines of Production Linked Incentive (PLI) Scheme 2.0 for IT Hardware has been finalised.

• The government has extended the timelines for receiving applications under PLI Scheme 2.0 for IT hardware till July 31, 2023.

• The ambitious scheme aims to broaden and deepen the IT hardware manufacturing ecosystem in the country.

• In May, the Union Cabinet approved a Rs 17,000 crore-incentive to boost local manufacturing of IT hardware like tablets and laptops. 

• The scheme is projected to generate an incremental production worth Rs 3.35 lakh crore over a period of six years.

• The scheme covers laptops, tablets, all-in-one PCs, servers and ultra-small form factor devices. 

• The companies will get an incentive of up to 5 per cent and an optional incentive of 4 per cent if they use domestically-produced components compared to just 2 per cent incentive offered under the old scheme. 

• The scheme will play a key role in achieving $1 trillion digital economy goal, including $300 billion of electronics manufacturing by 2025-26.

• Electronics manufacturing in the country has witnessed a 17 per cent Compound Annual Growth Rate (CAGR) in the last eight years to cross $105 billion worth production this year. 

• The PLI scheme, launched in April 2020 with a focus on mobile phone production, has given a massive boost to electronics manufacturing in the country. 

• India has become the world’s second-largest manufacturer of mobile phones. Exports of mobile phones crossed $11 billion in March.

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 sectors are:

1) Mobile manufacturing and specified electronic components (Large scale electronics manufacturing)

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.

• In September 2021, the Union government approved a PLI scheme for drones and drone components with an allocation of Rs 120 crore spread over three financial years.

• 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.

Manorama Yearbook app is now available on Google Play Store and iOS App Store