Prime Minister Narendra Modi addressing a webinar on the Production Linked Incentives scheme, organised by the Department of Industry and International Trade and NITI Aayog, in New Delhi on March 5, 2021.
Prime Minister Narendra Modi addressing a webinar on the Production Linked Incentives scheme, organised by the Department of Industry and International Trade and NITI Aayog, in New Delhi on March 5, 2021.

Production Linked Incentives in 13 sectors demonstrate government’s commitment, says Modi

New Delhi, March 5, 2021

Production Linked Incentives (PLI) in 13 sectors demonstrate the government’s commitment to all-round development, Prime Minister Narendra Modi said today.

The Prime Minister was addressing a webinar on the PLI scheme organized by the Department for Promotion of Industry and International Trade and NITI Aayog.

He said a provision of about Rs 2 lakh crore rupees has been made for schemes related to PLI in this year’s Union Budget. An average of 5% of production would be given as an incentive. This meant that PLI schemes will lead to production worth $ 520 billion in India in the next five years. It was also estimated that sectors for which the PLI scheme has been created will witness a doubling of the workforce.

Modi said PLI-related announcements were being implemented with speed. The recently approved PLI schemes in IT hardware and Telecom equipment manufacturing will lead to a tremendous increase in production and domestic value addition. IT hardware was estimated to achieve Rs 3 trillion worth of production in four years and domestic value addition is expected to rise from the current 5-10% to 20-25% in five years.

“Similarly, telecom equipment manufacturing will witness an increase of about Rs 2.5 lakh crore in five years. We should be in a position to export worth Rs 2 lakh crore,” he added.

In the pharmaceuticals sector, more than Rs 15,000 crore investment was expected in the next 5-6 years under PLI leading to Rs 3 lakh crore in pharma sale and export increase worth Rs 2 lakh crore, he said.

The Prime Minister asserted that the way India was serving humanity, it has become a big brand all over the world. India's credibility and identity were reaching new heights. “Worldwide trust has increased in our medicines, our medical professionals and our medical equipment. To honour this trust, the pharma sector should work on chalking out a long-term strategy,” he added.

The PLI scheme was launched last year to incentivise the manufacturing of mobile phones and electronic components in India. Even during the COVID-19 pandemic, the sector manufactured goods worth Rs 35,000 crore in 2020 and saw a fresh investment of about Rs 1,300 crore leading to the creation of thousands of new jobs.

He expressed the hope that the PLI scheme would make a major impact on the country's MSMEs ecosystem by creating anchor units in every sector that needs a new supplier base across the entire value chain. He urged the industry to join and take advantage of the scheme. The focus of the industry should be on creating the best quality goods for the country and the world.

“The Industry should innovate according to the needs of the fast-changing world, increase our participation in R&D, upgrade the manpower skills and use of new technology,” he added.

Over the past 6-7 years, several successful efforts have been made to encourage Make in India at different levels. He stressed the need to take a big leap, increase the speed and scale to boost manufacturing. The Prime Minister also cited examples around the world where countries have accelerated development by increasing the manufacturing capacities which led to proportional employment generation.

“The Government’s thinking is clear, ‘Minimum Government, Maximum Governance’ and it expects Zero Effect, Zero Defect. The Government is working at every level to promote ease of doing business, reducing the compliance burden, creating multimodal infrastructure to reduce logistics costs and constructing district level export hubs.

“We believe that Government interference in everything creates more problems rather than solutions. Therefore, self-regulation, self-attestation and self-certification are being emphasized,” Modi said.

He emphasized the need to make Indian companies and manufacturing globally competitive and to create global recognition for production cost, products, quality and efficiency. “We have to attract cutting edge technology and maximum investment in the sectors related to our core competencies,” he added.

Earlier, industrial Incentives used to be open-ended input based subsidies, now they have been made targeted and performance-based through a competitive process, he said. For the first time, 13 sectors have been brought under Production Linked Incentives. PLI benefits the entire ecosystem associated with the sector. With PLI in auto and pharma, there will be very less foreign dependence related to auto parts, medical equipment and raw materials of medicines.

The energy sector will be modernized in the country with the help of Advanced Cell Batteries, Solar PV modules and Specialty Steel. Similarly, the PLI for the textile and food processing sector will benefit the entire agriculture sector, he added.

Referring to the agriculture sector, he said, “It is a matter of pride that following India's proposal, the United Nations has declared the year 2023 as the International Year of Millets. More than 70 countries came to support India's proposal and unanimously accepted it in the UN General Assembly.

“This is also a big opportunity for our farmers. A worldwide campaign should be started on the nutritional potential of millets or coarse grains to protect people from diseases. The demand for millets at home and abroad will increase rapidly with the UN announcement. The Agriculture and Food Processing Sector to take full advantage of this opportunity,” he added.


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