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Mahesh

28/04/23 06:45 AM IST

Production-Linked Incentive scheme for the automotive sector

In News
  • The Ministry of Heavy Industries here today announced the release of SOPs under the PLI Auto scheme to testing agencies.
About PLI- Auto Scheme
  • The Ministry of Heavy Industries notified the Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India (PLI-AUTO Scheme) on September 23, 2021, with a budgetary outlay of Rs 25,938 crore.
  • The PLI-Auto Scheme proposes financial incentives to boost domestic manufacturing of advanced automotive technology (AAT) products and attract investments in the automotive manufacturing value chain.
  • The scheme has two parts: Champion OEM, which will make electric or hydrogen-powered vehicles, and Component Champions, which will make high-value and high-tech components.
  • The key objectives of the Production Linked Incentive (PLI) Scheme for Automobiles and Auto Components are to provide financial incentives to boost domestic manufacturing of advanced automotive technology 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 advanced automotive technology products.
  • The scheme also aims to generate employment in the country.
  • To facilitate the automobile industry's move up the value chain into higher-value-added products
Guidelines
  • Applicants must achieve a domestic value addition (DVA) of 50% to claim incentives under the scheme.
  • The auto companies and component makers are required to calculate and present the DVA across their supply chain and present these details to the testing agencies.
Source- PIB

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