The Ministry of Heavy Industries extended the Production-Linked Incentive (PLI) Scheme for Automobiles and Auto Components by a year. The decision was made after the Empowered Group of Secretaries (EGoS) approved it.
The Ministry has also changed the scheme to provide more clarity and flexibility. The incentive under the amended scheme will now be applicable for five consecutive financial years, starting from FY24. The previous tenure of the scheme was from FY23 to FY27.
However, due to the stringent criteria, very few companies could qualify. As a result, the industry sought an extension of the disbursement date and the final deadline. This ensures that companies that could not get incentives in the first year of the scheme don’t miss out on one year of incentives.
The incentive will be disbursed in the following financial year, FY25. An approved applicant will be eligible for benefits for five consecutive financial years, but not beyond March 31, 2028.
If an approved company fails to meet the threshold for an increase in determined sales value over the first year’s threshold, it won’t receive any incentive for that year.
However, the company can still get benefits in the next year if it meets the threshold calculated based on a 10% year-on-year growth over the first year’s threshold. This provision ensures fairness for all approved companies and protects those who choose to front-load their investments.
The amendment also includes changes to the table showing the incentive outlay, with the total indicative incentive amounting to ₹25,938 crore.
