In a major digitisation push, the Union government has cleared the names of as many as 33 companies that would be awarded benefits under the Rs 12,195-crore production-linked-incentive (PLI) scheme for telecom and networking equipment.
According to top sources, following its nod to 33 companies the Centre is likely to reject applications of Tech Mahindra, Sterlite Technologies and Kenstel Networks on technical grounds. The PLI scheme was notified on February 24 early this year.
The scheme has received 36 applications, of which three are likely to be rejected. The winners – who would be notified soon – have committed Rs 3,455 crore as proposed investments. Among the ‘global’ companies that have applied, seven out of the eight are likely to get through.
These companies include Taiwanese Foxconn (proposed investment Rs 208 crore), Rising Stars Hi-Tech (Rs 125 crore), Finnish Nokia Solutions (Rs 125 crore), American makers Flextronics (Rs 102 crore), Jabil Circuit (Rs 176 crore), CommScope (Rs 209 crore), and Sanmina-SCI (Rs 110 crore).
Further on the domestic side, 26 companies are cleared by the Centre. These companies include Akashastha Technologies (proposed investment Rs 593 crore), VVDN Technologies (Rs 400 crore), Neolync Tele Communications (Rs 188 crore), Dixon Electro Appliances (Rs 180 crore), ITI (Rs 120 crore), Tejas Networks (Rs 111 crore), GDN Enterprises (Rs 46 crore) and STL Networks (Rs 49 crore).
While, the application of Sterlite Technologies, filed under the ‘global’ companies category, is being rejected for falling short of the minimum threshold criteria of Rs 10,000-crore revenue, the application of Tech Mahindra is also being rejected as it is not engaged in the manufacturing of telecom equipment, but only in software.
Kenstel Networks, which has applied under MSME, has certified its revenues at Rs 6.4 crore, which is less than the stipulated Rs 10 crore threshold mandated for the category. The government had floated the scheme to encourage domestic manufacturing in the telecom sector, including core transmission equipment, 4G/5G next-generation Radio Access Network, IoT access devices and enterprise products such as switches and routers.
The government feels that with the transition to 5G and other futuristic technologies, India should have a robust, manufacturing eco-system.