IGI Logo

Union Heavy Industries Minister Mahendra Nath Pandey has said that the government has decided to extend the Rs 25,938-crore production-linked incentive (PLI) scheme for the automotive sector by one year. Post extension, the five-year scheme, originally in place from 2022-23 to 2026-27, will be active until 2027-28. At present, incentives are applicable under the scheme for determined sales of Advanced Automotive Technology (AAT) products (vehicles and components) manufactured in India from April 1, 2022 onwards for a period of five consecutive years.

Pandey stated that the ministry has also accepted other suggestions made by auto industry stakeholders pertaining to the scheme including quarterly disbursement of subsidies and increasing the number of agencies testing domestic value addition from two at present to four. He hoped that the schemes will gather pace due to these measures. He also said that the government is committed to fostering a conducive business environment and accelerating growth in the Indian Automotive sector.

The minister further said that the PLI-AUTO scheme incentivizes only those eligible AAT products for which a minimum of 50 per cent Domestic Value Addition (DVA) is achieved and has been certified by Testing Agencies (TAs) of MHI. This criterion shall reduce imports, facilitate deep localization for AAT products and enable creation of domestic as well as global supply chains. As many as 95 companies have been admitted under the scheme that looks to promote local manufacturing of new technology products such as electric vehicles (EV) through subsidies.