Why in News?
The Union government has reopened applications (Sept 15–Oct 14) for the Production-Linked Incentive (PLI) scheme for white goods to boost manufacturing of AC and LED components. Both new and existing beneficiaries may invest more, following earlier success and ₹10,406 crore commitments.
Description:
Launched: April 2020 (Govt. of India).
- Objective:
- Boost domestic manufacturing & reduce import dependence.
- Attract global companies/OEMs to set up units in India.
- Enhance exports, value addition, jobs & skills.
- Coverage: 14 sectors (electronics, pharma, food processing, telecom, textiles, specialty steel, drones, white goods, solar modules, ACC batteries, etc.).
- Incentive: Linked to incremental production/sales over a base year.
Progress so far:
- Success: Mobile phones, pharma, food processing.
- Lagging: IT hardware, textiles, specialty steel, advanced chemicals.
- Issue: Local value addition often remains in single digits (esp. mobiles).
PLI 2.0 – Proposed Reforms:
- Link incentives to value addition & localization (components, semiconductors, PCBs).
- Export-oriented incentives → encourage scale & global competitiveness.
- Build component ecosystem: JVs, tech transfer, MSME integration.
- MSME support: credit, infra, special incentives.
- Focus on semiconductors: fabs, chip design, assembly.
Global Lessons:
- Inspired by industrial policies of China, Japan, South Korea.
- Example: China allowed Tesla → boosted EV supply chain → BYD, Nio, etc.
- India aims to replicate: foreign investment + domestic ecosystem.
Significance:
- Promotes Atmanirbhar Bharat, Make in India.
- Bridges supply-chain gaps → reduces imports.
- Enhances exports & integrates India into global value chains.
- Generates employment & skills in high-tech manufacturing.
Related Policies:
- National Policy on Electronics (NPE), 2019
- National Policy on Advanced Chemistry Cell Battery Storage
- National Semiconductor Mission
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