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Production-linked incentive (PLI) scheme

Topics Covered: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.

Production-linked incentive (PLI) scheme:


The Central government has unveiled a production-linked incentive (PLI) scheme to encourage domestic manufacturing investments in 10 more sectors, with an estimated outlay of about ₹1.46 lakh crore over the next five years.

  • These sectors have been identified on the basis of their potential to create employment and make India self-reliant.

The 10 sectors include:

Food processing, telecom, electronics, textiles, speciality steel, automobiles and auto components, solar photo-voltaic modules and white goods, such as air conditioners and LEDs.


About the PLI scheme:

To make India a manufacturing hub, the government had announced the PLI scheme for mobile phones, pharma products, and medical equipment sectors.

  • 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.

What the scheme seeks to achieve?

  1. Make domestic manufacturing competitive and efficient.
  2. Create economies of scale.
  3. Make India part of global supply chain.
  4. Attract investment in core manufacturing and cutting edge tech.
  5. Competitive manufacturing would in turn lift exports.



Prelims Link:

  1. Key proposals under the National Policy on Electronics.
  2. Production linked incentive scheme- when was it announced?
  3. Incentives under the scheme is available to?
  4. What kind of investments will be considered?
  5. Duration of the scheme.
  6. Who will implement it?

Mains Link:

What is the production linked incentive scheme for electronics manufacturers? Discuss.

Sources: the Hindu.