PLI scheme for automobile, auto component attracts Rs 74,850 crore investment
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Loading... - Ishaan Singh
- 16 Mar 2022
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The Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India has been successful in attracting proposed investment of Rs 74,850 crore against the target estimate of investment Rs 42,500 crore over a period of five years.
The proposed investment of Rs 45,016 crore is from approved applicants under Champion OEM Incentive Scheme and Rs 29,834 crore from approved applicants under Component Champion Incentive Scheme.
A total of 115 companies had filed their application under the Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India which was notified on 23 September 2021.
Out of which, 5 Auto OEM companies had applied for both parts of the scheme. The scheme was open for receiving applications till 23:59:59 hours IST on 9 January 2022.
Incentives are applicable under the scheme for Determined Sales of Advanced Automotive Technology (AAT) products (vehicles and components) manufactured in India from 1 April 2022 onwards for a period of 5 consecutive years.
Reacting to the response Union Heavy Industries Minister Dr Mahendra Nath Pandey said, “The overwhelming response shows that Industry has reposed its faith in India’s stellar progress as a world-class manufacturing destination which resonates strongly with Hon’ble Prime Minister’s clarion call of AtmaNirbharBharat – a self-reliant India. India will surely take a huge leap towards cleaner, sustainable, advanced and more efficient Electric Vehicles (EV)based system”.
The Government approved the Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India for enhancing India’s Manufacturing Capabilities for Advanced Automotive Products (AAT) with a budgetary outlay of Rs 25,938 crore.
The Production Linked Incentive (PLI) Scheme for Automobile and Auto component industry proposes financial incentives to boost domestic manufacturing of Advanced Automotive Technology (AAT) products and attract investments in the automotive manufacturing value chain.
Its prime objectives include overcoming cost disabilities, creating economies of scale and building a robust supply chain in areas of AAT products. It will also generate employment. This scheme will facilitate the Automobile Industry to move up the value chain into higher value-added products.
The scheme has two components viz. Champion OEM incentive scheme and Component Champion incentive scheme. Total 95 applicants have been approved under this PLI scheme.MHI had earlier approved 20 applicants (along with their 12 subsidiaries) for the Champion OEM Incentive scheme. Subsequently, MHI has processed the applications received under the Component Champion incentive scheme and 75 applicants (along with their56 subsidiaries) have been approved under this category of the scheme.
Two Auto OEM companies have been approved for both parts of the scheme.
The PLI Scheme for the auto sector was open to existing automotive companies as well as new investors who are currently not in the automobile or auto component manufacturing business.
The Champion OEM Incentive scheme is a ‘sales value linked’ scheme, applicable on Battery Electric Vehicles and Hydrogen Fuel Cell Vehicles of all segments.
The Component Champion Incentive scheme is a ‘sales value linked’ scheme, applicable on Advanced Automotive Technology components of vehicles, Completely Knocked Down (CKD)/ Semi Knocked Down (SKD) kits, Vehicle aggregates of 2-Wheelers, 3-Wheelers, passenger vehicles, commercial vehicles, and tractors, etc.
This PLI Scheme for the automotive sector ( Rs 25,938 crore) along with the already launched PLI scheme for Advanced Chemistry Cell (ACC) ( Rs 18,100 crore) and Faster Adaption of Manufacturing of Electric Vehicles(FAME) ( Rs 10,000 crore) will enable India to leapfrog from traditional fossil fuel-based automobile transportation system to environmentally cleaner, sustainable, advanced and more efficient Electric Vehicles (EV) based system.
The PLI scheme for the Automobile and Auto Component Industry has been a huge success in terms of the applications received from local as well as globally headquartered groups engaged in/ proposing to manufacture Advanced Automotive Technology vehicles/ products.
Apart from Indian business groups, approved applicants include groups from countries such as Japan, Germany, USA, UK, Republic of Korea, Ireland, France, Belgium, Netherlands, and Italy. Read More...
