Production linked incentive plan

Q. Why is this in news?

A. Three Apple Inc.’s top contract manufacturers are planning to invest a total of almost $900 million in India in the next five years to tap into a new production-linked incentive plan.

Q. What is PLI scheme?

• Notified on April 1 as a part of the National Policy on Electronics.
• It proposes a financial incentive to boost domestic manufacturing and attract large investments in the electronics value chain.

Q. What are its some of Key features?

• The scheme shall extend an incentive of 4% to 6% on incremental sales (over base year) of goods manufactured in India and covered under target segments, to eligible companies, for a period of five (5) years with financial year (FY) 2019-20 considered as the base year for calculation of incentives.
• The Scheme will be implemented through a Nodal Agency which shall act as a Project Management Agency (PMA) and be responsible for providing secretarial, managerial and implementation support and carrying out other responsibilities as assigned by Ministry of electronics and information technology  from time to time.

Q. What is the eligibility criteria?

• According to the scheme, companies that make mobile phones which sell for Rs 15,000 or more will get an incentive of up to 6 per cent on incremental sales of all such mobile phones made in India.
• In the same category, companies which are owned by Indian nationals and make such mobile phones, the incentive has been kept at Rs 200 crore for the next four years.

Q. What kind of investments will be considered?

• All electronic manufacturing companies which are either Indian or have a registered unit in India will be eligible to apply for the scheme.
• These companies can either create a new unit or seek incentives for their existing units from one or more locations in India.
• However, all investment done by companies on land and buildings for the project will not be considered for any incentives or determine eligibility of the scheme.