PLI for IT hardware 2.0 saw applications from 40 firms and proposed investment of Rs. 4.65 lakh crore
- IBEF
- September 1, 2023
40 companies have expressed interest in the new production-linked incentive (PLI) scheme for IT hardware, and it is anticipated that these investments will amount to an additional Rs. 5,010 crore (US$ 605.7 million) in production over the next six years.
"Large IT hardware companies such as Dell and HP are participating directly under the scheme while other major players such as HPE, Lenovo, Acer, ASUS, and Thomson participating through EMS (electronic manufacturing services) companies - Flextronics, Rising Star (Foxconn), etc. - having manufacturing facilities in India," the government said in a statement.
Additionally, applications have been submitted by domestic businesses including Padget (Dixon), VVDN, Netweb, Syrma, Optiemus, Sahasra, Neolync, Panache, Sojo (Lava), Kaynes Technologies, etc.
13 companies, including seven international and six domestic, applied under the hybrid category, compared to 27 for the domestic category.
According to the PLI 2.0 for IT Hardware scheme guidelines and the entire budget outlay of Rs. 17,000 crore (US$ 2.05 billion), applicants would be chosen in the near future, the government announced.
According to said Mr. Pankaj Mohindroo, the Chairman of the industry body, India Cellular & Electronics Association (ICEA), "This is not just 'Make in India'; this is 'Make in India for the World.' It's about becoming globally competitive, especially when it comes to increasing exports.”
The PLI scheme, which aims to increase domestic production of IT hardware, provides incentives for Indian manufacturers of laptops, tablets, all-in-one PCs, servers, and ultra-small form factors. The government said that the scheme with an outlay of Rs. 17,000 crore (US$ 2.05 billion) was oversubscribed, receiving proposals worth Rs. 22,890 crore (US$ 2.76 billion). The scheme beneficiaries will generate direct employment in excess of 75,000 jobs.
The interest in the new scheme is related to India's recent decision to restrict laptop imports through a licencing system starting on November 1 for national security grounds. According to the revised scheme, global companies will have to invest Rs. 500 crore (US$ 60.4 million) over a six-year period, while hybrid and domestic companies will have to invest Rs. 250 crore (US$ 30.2 million) and Rs. 20 crore (US$ 2.4 million), respectively.
Incentives for the production of laptops, tablets, all-in-one PCs, servers, and ultra-small form factors in India are increased under the revised scheme by an average of 5%, more than double the 2% incentive provided under the prior edition. The new scheme also offers participants greater flexibility with regard to investment options and tenure. The applicants can select 2023, 2024, or 2025 as the base year for investment and computing incremental sales, even though the scheme has a six-year overall duration.
Existing applicants (from the previous version of the plan) who have not yet claimed any reward may likewise participate in the new scheme. Applicants who have previously claimed incentives may begin taking part in the second year.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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