- About us
- Site map
- Contact Us
- Contact Us
The Cabinet has cleared the Production Linked Incentive (‘PLI’) scheme for the auto sector to boost the struggling industry, ramp up production and generate employment. The Government has further announced PLI scheme for the drone sector as well. Incentives worth Rs. 26,058 crores will be offered under the PLI scheme for auto sector, auto components and drone sector. The focus of the auto sector PLI scheme is likely to promote manufacture of electric vehicles and hydrogen fuel cell vehicles.
It is estimated that over a period of five years, the PLI Scheme for Automobile and Auto Components Industry will lead to fresh investment of over Rs. 42,500 crores, incremental production of over Rs. 2.3 lakh crores and will create additional employment opportunities of over 7.5 lakh jobs. Further this will increase India’s share in global automotive trade.
The scheme has two components viz. Champion OEM Incentive Scheme and Component Champion Incentive Scheme. 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.
With the available information, it is understood that new players in the auto component sector will have to invest Rs. 500 crores while the existing players will have to invest Rs. 250 crores. It is contemplated that auto component sector could include automatic transmission, automatic braking, electronic steering system among others. This scheme 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 information provided in this update is intended for informational purposes only and does not constitute legal opinion or advice. Readers are requested to seek formal legal advice prior to acting upon any of the information provided herein. This update is not intended to address the circumstances of any particular individual or corporate body. There can be no assurance that the judicial/ quasi judicial authorities may not take a position contrary to the views mentioned hereinrra quis.
Sign up for the Newsletter