New Delhi: The heavy industries ministry on Tuesday said it has disbursed ₹1,350.83 crore to five beneficiary companies under the ₹25,938-crore production-linked incentive (PLI) scheme for automobiles and their components since the scheme’s inception in 2021 until November 2025.
In FY25, the first year of disbursals, the government had doled out ₹322 crore to four companies-Tata Motors Ltd, Mahindra & Mahindra Ltd, Ola Electric Mobility Ltd, and Toyota Kirloskar Auto Parts Ltd-indicating disbursal of about ₹1,000 crore in the current fiscal year so far.
Minister of state for the heavy industries ministry Bhupathiraju Srinivasa Varma told parliament on Tuesday that of the eligible sales target of 2.31 trillion by March 2028, there had been eligible sales worth ₹32,879 crore till the end of September this year.
Eligible companies get incentives under the scheme based on their sales. The government marked FY20 as a base year for sales, and said it would disburse 13-18% of the incremental sales each year to companies, as per the scheme norms.
Mint had reported earlier that the government is likely to spend about ₹2,000 crore in PLI-Auto incentives this fiscal year, with Tata Motors and Mahindra & Mahindra claiming about ₹400 crore and ₹280 crore, respectively.
Maharashtra, Haryana and Tamil Nadu had the highest number of manufacturing units of the total 278 under the scheme. Maharashtra topped the table with 85 units, followed by Tamil Nadu with 49 and Haryana with 43, the minister said.
The incentive scheme was greenlit in 2021, with an aim to provide incentives to manufacturers of zero-emission vehicles and their spare parts. Under the scheme, 82 companies, vehicle and spare part makers, can claim incentives.
The disbursals in FY26 comes after a rare-earth magnet supply shock in April due to China’s strict export control. These magnets are used in crucial manufacturing sectors such as defence, electronics, renewable energy and automobiles, including electric vehicles.
Indian manufacturers struggled to procure these essential magnets following the supply crunch. However, electric two-wheeler makers found alternatives such as light rare-earth magnets that were not blocked by China’s curbs. Another alternative was the use of ferrite motors, which are devoid of rare-earth magnets.
In the wake of this crisis, the automobile industry sought relaxation in the government’s clean mobility incentive schemes, such as PLI-Auto and the ₹10,900-crore PM E-Drive scheme. The government, in September, temporarily relaxed localization rules for e-bus and e-truck makers under the PM E-Drive scheme, but did not relax any rules for electric two- and three-wheeler makers.
India’s EV market was valued at $54.41 billion in 2025, while the hybrid vehicle market was at about $0.53 billion, according to market research company Mordor Intelligence. India’s automobile market, world’s third-largest by sales, was valued at $137.06 billion.
EV sales in India rose to over 2 million units in 2025, from about 1.9 million in the previous year.
“Early adoption was constrained by issues such as (driving) range anxiety, high upfront costs, and limited charging stations. However, strong government initiatives aimed at making India a global EV leader and achieving net zero emissions by 2070 have been instrumental in driving progress,” a December 2025 report by KPMG on India’s EV sector said.