Indian Economy News

Production linked incentive scheme strengthens India’s manufacturing capacity and export performance

The Production Linked Incentive (PLI) scheme has emerged as a key policy instrument in strengthening India’s manufacturing base while enhancing the country’s export competitiveness across strategic sectors. Implemented by the Government of India, the scheme is designed to encourage large-scale manufacturing, improve economies of scale and attract global investment into India. By offering performance-based financial incentives, the PLI framework supports companies that expand production, adopt advanced technologies and integrate more deeply into global value chains.
Since its launch, the PLI scheme has been rolled out across multiple sectors, including electronics, pharmaceuticals, automobiles and auto components, telecom, textiles and specialty steel. These targeted interventions have contributed to higher domestic production, increased capacity utilisation and stronger export performance. According to government data, the scheme has helped companies scale up operations, reduce import dependence and improve cost competitiveness, particularly in sectors with high export potential. In addition, the PLI initiative has encouraged investments in greenfield and brownfield manufacturing projects, leading to technology upgrades and job creation across manufacturing clusters.
The scheme also aligns with broader national priorities such as Make in India and Atmanirbhar Bharat, reinforcing India’s position as a global manufacturing hub. Improved policy certainty, combined with production-linked incentives, has strengthened investor confidence and attracted both domestic and foreign capital. As implementation progresses, the PLI scheme is expected to play a sustained role in boosting exports, deepening industrial capabilities and supporting long-term economic growth by building a resilient and globally competitive manufacturing ecosystem.

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