Rs 26,000-cr PLI scheme for

Auto & Drone sector

- By Ankit Agrawal

16-09-2021
16-09-2021
16-09-2021
 WHAT HAS HAPPENED?

The government of Wednesday announced Rs 26,058

crore for PLI (production linked incentive) schemes
for the auto, auto component industry and drone
industry to enhance manufacturing in India.

16-09-2021
 HOW MUCH IS ALLOCATED?

A sum of Rs 25,929 crore has been earmarked for the auto

sector and Rs 120 crore for the drone Industry.

The PLI scheme will incentivize the emergence of advanced

automotive technologies' global supply chain in India.

16-09-2021
 OUTCOME PREDICTED?

It is estimated that over a period of five years, the PLI scheme

for the automobile and auto components industry will lead
to a fresh investment of over Rs 42,500 crore,

Incremental production of over Rs 2.3 lakh crore and will

create additional employment opportunities of over 7.5 lakh
jobs, Union minister Anurag Thakur said.

16-09-2021
 WHY PLI IS INTRODUCED?

The scheme for the auto sector envisages overcoming the cost
disabilities to the industry for the manufacture of advanced
automotive technology products in India.

The incentive structure will encourage the industry to make

fresh investments for the indigenous global supply chain
of Advanced Automotive Technology products.

16-09-2021
The scheme for the auto sector is open to existing
automotive companies as well as new investors
who are currently not in the automobile or
auto component manufacturing business.

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 SUB-PARTS OF THE PLI

The scheme has two components –

Champion OEM Incentive Scheme and

Component Champion Incentive Scheme.

16-09-2021
 The Champion OEM Incentive scheme is a
'sales value linked' scheme,

Applicable on Battery Electric Vehicles and Hydrogen

Fuel Cell Vehicles of all segments, the minister said.

16-09-2021
 The Component Champion Incentive scheme is a
'sales value linked' scheme,

Applicable on Advanced Automotive Technology components

of vehicles, Completely Knocked Down (CKD)/ Semi Knocked
Down (SKD) kits, vehicle aggregates of 2-Wheelers,
3-Wheelers, passenger vehicles, commercial
vehicles and tractors.

16-09-2021
 COMPLIMENTING SCHEMES IN PLACE

This PLI scheme for the automotive sector along with the already
launched PLI scheme for Advanced Chemistry Cell (Rs 18,100 crore)
and

Faster Adaption of Manufacturing of Electric Vehicles (Rs 10,000

crore) will enable India to leapfrog from traditional fossil fuel-based
automobile transportation system,

To environmentally cleaner, sustainable, advanced and more efficient

Electric Vehicles (EV) based system.

16-09-2021
 FOR DRONES

Further, the PLI scheme for the drones and drone components
industry addresses the strategic, tactical and operational
uses of this revolutionary technology.

A product-specific PLI scheme for drones with clear revenue targets

and a focus on domestic value addition is key to building capacity and
making these key drivers of India's growth strategy.

The scheme will over a period of three years, lead to investments

worth Rs 5,000 crore, an increase in eligible sales of Rs 1,500 crore
and create additional employment of about 10,000 jobs.

16-09-2021
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The production linked incentive scheme makes introduction of new
products and technologies less risky.

But companies still have to look at other factors, look at economics.

It (PLI scheme) doesn’t change the other parameters.

“For introducing a product in the market, companies have to keep in

mind many considerations. PLI will help reduce the cost of
production. Cost of production is one factor but not the only one.”

16-09-2021
Earlier last month the country’s largest carmaker had indicated that it
will not enter the EV segment in the short term.

“We (Maruti Suzuki) have said that we will introduce an electric

vehicle when there is an adequate market.

The PLI scheme doesn’t create a market for products. Price is one
factor, there are many factors which determine if there
is a market for a product," Bhargava said.

16-09-2021
 The government had first announced the scheme last year with a
financial outlay of Rs 57,043 crore,

With plans to incentivise companies to build combustion engine

vehicles and their components for export as well as domestic
market, with some special benefits for EVs.

The plans were then changed to focus primarily on clean energy

vehicles while the budget was pruned to Rs 25,938 crore.

16-09-2021
Q. Electric Vehicles are generally powered by?

A) Aluminum batteries

B) Lead-acid batteries

C) Sodium batteries

D) Magnesium batteries

16-09-2021
 Rs 26,000-cr PLI scheme for
Auto & Drone sector

- By Ankit Agrawal

16-09-2021
16-09-2021
 ankitmay28

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