India's DoT has now issued the PLI Scheme operational guidelines for telecom and networking product manufacturing.
After extensive consultations with stakeholders, India’s Department of Telecommunications (DoT) has now issued the operational guidelines for the “Production Linked Incentive (PLI) Scheme” for the telecom and networking product manufacturing.
With the objective to boost domestic manufacturing, investments, and export in the telecom and networking segment, the scheme aims to create global champions out of India who have the potential to grow in size and scale using cutting edge technology and thereby penetrate the global value chains.
The PLI Scheme will be implemented within the overall financial limits of ₹12,195 crores only for implementation of the scheme over a period of five years. For the MSME category, financial allocation will be ₹1000 crores.
The Small Industries Development Bank of India (SIDBI) has been appointed the Project Management Agency (PMA) for the PLI scheme.
The scheme will be effective from April 1, 2021. Investment made by successful applicants in India from April 1 onwards and up to financial year (FY) 2024-2025 shall be eligible, subject to qualifying incremental annual thresholds. The support under the scheme shall be provided for a period of five years, i.e. from FY 2021-22 to FY 2025-26.
The scheme is open to both MSME and Non-MSME companies, including domestic and multinational companies.
Interested applicants can register at https://www.pli-telecom.udyamimitra.in. The application window shall be open up to July 3, 2021.
Applicants will have to satisfy the minimum revenue criteria to be eligible under the scheme. The company may decide to invest in single or multiple eligible products. The scheme stipulates a minimum investment threshold of ₹10 crores for MSME and ₹100 crores for non-MSME applicants. Land and building cost will not be counted as investment. Eligibility shall be further subject to Incremental Sales of Manufactured Goods (covered under Scheme Target Segments) over the base year (FY2019-20).
DoT shall grant approvals to 10 eligible applications each in MSME and non-MSME categories. Out of the 10 applications in non-MSME category, at least three applicants will be eligible Domestic companies. The applications will be shortlisted from highest to lowest on the basis of committed cumulative incremental investment during the scheme period.
It is estimated that full utilization of the scheme funds is likely to lead to incremental production of around ₹2.4 lakh crores with exports of around ₹2 lakh crores over five years. It is also expected that the scheme will bring investments of around ₹3,000 crore and generate huge direct and indirect employment—in line with the larger objectives of “Make in India”.