Indian Economy News

Incentives under the Production Linked Incentive Scheme for the Food Processing Industry

The Cabinet approved the Production Linked Incentive Scheme for Food Processing Industry (PLISFPI) on March 31, 2021, allocating Rs. 10,900 crores (US$ 1.30 billion) for implementation from FY 2021-22 to FY 2026-27. The scheme encompasses three key components: incentivizing manufacturing in four food product segments (Cook/Ready foods, Processed Fruits and vegetables, Marine Products, and Mozzarella Cheese), promoting Innovative/Organic products of SMEs, and incentivizing branding and marketing abroad to promote Indian brands globally. Additionally, the PLI Scheme for promoting Millet-based Products, launched in FY 2022-23 with an outlay of 800 crore (US$ 95.92 million), utilized the scheme’s savings.

As of April-September 2023, PLI beneficiaries have reported investments totalling Rs. 7,126 crore (US$ 854.46 million) under the scheme, with sales amounting to Rs. 49,825 crore (US$ 5.97 billion). According to scheme guidelines, PLI beneficiaries must submit incentive claims for a specific financial year by December 31 of the following financial year.

During the formulation of PLISFPI, proactive measures were taken to align it with global best practices and market demands. This process involved active engagement with various stakeholders, including industry experts, large-scale manufacturers, and SMEs. An extensive consultative approach was adopted to gather inputs while formulating the scheme guidelines. This collaborative effort is ongoing through regular engagements with stakeholders to ensure the continued relevance and effectiveness of the scheme guidelines.

The scheme aims to generate employment for approximately 2.5 lakh individuals. As of September 30, 2023, Quarterly Review Reports from PLI beneficiaries indicate the creation of employment for 2,37,335 persons.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.