InvestorQ : How is the PLI scheme performing currently and why have Indian companies asked for a revamp of the PLI scheme?
ishika Banerjee made post

How is the PLI scheme performing currently and why have Indian companies asked for a revamp of the PLI scheme?

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1 month ago
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Even as the markets have been celebrating the fiscal boost given by the production linked incentives or PLI scheme launched by the Indian government, corporate India is asking for tweaks. The PLI scheme was meant to encourage more production in-house and also leverage on India’s manufacturing potential to become an outsourcing hub.

Indian companies have been asking the government for a variety of tweaks in the production-linked incentive or PLI scheme intended to encourage foreign direct investment or FDI into India. In short, most Indian manufacturing companies have demanded a level-playing field for local manufacturers versus the global players.

Under the PLI, the government will support new ventures by offering fiscal incentives to the tune of $26 billion. It is estimated that the actual multiplier effect of this scheme could be much bigger. The PLI scheme was intended basically to attract FDI, and in the process helping local manufacturers achieve scale and also provide a boost to Indian exports.

Telecom players have been lobbying for incentives to local value addition beyond just assembly operations. They want more importance given to local addition in the incentive formula. Indian businesses have also demanded relatively simpler incentive disbursement process. They feel, PLI tilts toward new companies entering India compared to incumbents.

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