Production Linked Incentive (PLI) Schemes – For Automobile & Automotive components
On September 15, 2021, India’s central government approved the ‘Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India for Enhancing India’s Manufacturing Capabilities for Advanced Automotive Products (AAT)’ with a budgetary outlay of INR 259.38 billion (US$3.50 billion) to boost domestic manufacturing capacity and attract investments to the automotive manufacturing value chain.
The incentive structure will encourage industry to make fresh investments for indigenous global supply chain of Advanced Automotive Technology products with “Make in India” concept.
The scheme for Automobile and auto components will be implemented over a period of five years starting from FY 2022-2023.
The scheme has two components viz Champion OEM Incentive Scheme and Component Champion Incentive Scheme.
Champion Original Equipment Manufacturers (OEM) Scheme
It is a sales value linked plan, applicable to battery electric and hydrogen fuel cell vehicles of all segments.
Champion OEM (Except 2W & 3W) – Listed companies
- Ashok Leyland Limited
- Eicher Motors Limited
- Suzuki Motor Limited
- Tata Motors Limited
- Mahindra & Mahindra Ltd.
Champion OEM 2W & 3W - Listed
- Bajaj Auto Limited
- Hero MotoCorp Ltd.
- TVS Motor Company Limited
New Non-Automotive Investor (OEM) – Unlisted Companies
1. Axis Clean Mobility Private Limited
2. Booma Innovative Transport Solutions Private Limited
3. Elest Private Limited
4. Hop Electric Manufacturing Private Limited
5. Ola Electric Technologies Private Limited
6. Powerhaul Vehicle Private Limited
Champion Incentive Scheme:
It is a sales value linked plan for advanced technology components, complete and semi-knocked down (CKD/SKD) kits, vehicle aggregates of two-wheelers, three-wheelers, passenger vehicles, commercial vehicles and tractors, including automobiles meant for military use and any other advanced automotive technology components prescribed by the Ministry of Heavy Industries – depending upon technical developments.
List of Listed companies under Champion Incentive Scheme are as follows:
- Maruti Suzuki India Limited
- Bharat Forge Limited
- Hero MotoCorp Ltd.
- Alicon Castalloy Limited
- Asahi India Glass Ltd.
- Automotive Axles Limited
- Bosch Limited
- Lumax Auto Technologies Limited
- Minda Corporation Limited
- Minda Industries Limited
- Motherson Sumi Systems Limited
- Motherson Sumi Wiring India Limited
- Pricol Limited
- Sandhar Technologies Limited
- Sansera Engineering Limited
- Schaeffler India Limited
- Sharda Motor Industries Limited
- Sona BLW Precision Forgings Limited
- Steel Strips Wheels Limited
- Sundram Fasteners Limited
- The Hi-Tech Gears Limited
- Tube Investments Of India Limited
- Varroc Engineering Limited
- Wabco India Limited
New non-automotive investor (component) companies:
1. Bharat Heavy Electricals Limited
2. Ceat Limited
There are many unlisted companies who are considered under PLI schemes by Government in both categories you can find the list for those from official site of Government.
There are many criteria which are needed to be fulfilled by all the companies in order to be the part of PLI scheme. Government has also introduced different slabs they are as follows:
Incentive Slabs for Champion OEM and New Non-Automotive (OEM) Investor Company
Incentive Slabs for Component Champion OEM and New Non-Automotive (Component) Investor Company
Benefits of PLI scheme:
- Incentivization of cost-efficient manufacturing of high value advanced automotive technology vehicles and products like sunroofs, adaptive front lighting, automatic braking, tire pressure monitoring systems, and collision warning systems, etc.
- Fresh investments of over Rs 42,500 crores.
- Incremental production of over Rs 2.3 lakh crore
- Additional employment opportunities of over 7.5 lakh jobs.
- Increase India’s share in global automotive trade.
- Accelerate investments towards developing a local EV ecosystem
Thus it can be said that GOI has taken very important and aggressive step towards Atmanirbhar Bharat and making India a self-reliant company by reducing its dependency on other countries and inviting Global countries to India which will help in strengthening the economy.
- HET ZAVERI
info@smartinvestment.in
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