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Centre’s PLI scheme attracts Rs 1,300 crore investment from top mobile makers

In a resounding success for Centre’s production linked incentive scheme (PLI), the top mobile manufacturers have invested over Rs 1,300 crore and produced goods worth around Rs 35,000 crore in the 2020 December quarter, the ministry of commerce and industries said on Wednesday.

According to the ministry, the Production Linked Incentive (PLI) Scheme for large scale electronics manufacturing was notified on April 1, 2020, under which incentives 4% to 6% incentives were announced on incremental sales for a period of five years subsequent to the base year.

The Union government had also selected 16 proposals under the scheme, including from mobile handset major Samsung, Foxconn Hon Hai, Rising Star, Wistron and Pegatron with an incentive outlay of Rs 36,440 crore.

As per government note, three companies including Foxconn Hon Hai, Wistron and Pegatron — are contract manufacturers for Apple iPhones. Apple and Samsung account for 37% and 22% of global sales revenue of mobile phones.

Indian companies selected under the scheme included Lava, Micromax, Padget Electronics, UTL Neolyncs and Optiemus Electronics.

“As per the quarterly review reports for the quarter ending December 2020, in the first five months of scheme operation and despite challenging times, the applicant companies have produced goods worth ~INR 35,000 crore and invested ~INR 1,300 crore under the scheme. Additional employment generation during this period stands at around 22,000 jobs,” the ministry said in a statement.

The second round of the PLI Scheme was launched on March 11 early this year, which focuses on building a vibrant and robust electronic component manufacturing ecosystem. “More than 60% of production is expected to be exported. The scheme is also expected to bring in an additional investment of Rs 11,000 crore. Value addition is expected to go up from 20-25% presently to 35-40% by 2025,” the statement said.

Meanwhile Centre has also notified PLI Scheme for IT Hardware on March 3 and the last date for application under the scheme is April 30. Under this scheme, eligible players will get an incentive of 1 to 4% on net incremental sales over the base year of goods manufactured in India.

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