The government doubles its investment in PLI for IT hardware

The Union Cabinet has authorised an upgraded version of the Production Linked Incentive (PLI) scheme for the manufacture of IT gear.

IT Hardware PLI Scheme

  • The PLI scheme for IT gear was launched in March 2021.
  • It offers over 4% incentives for incremental investment in domestic manufacturing for qualifying companies like Dell and Flextronics.
  • The initiative intends to improve domestic manufacture, boost exports, and establish India as a major player in the IT hardware market.
  • The initiative will run for six years, giving qualified enterprises with a long-term incentive to engage in domestic IT hardware manufacturing.

Increase in indigenous IT hardware

  • The government emphasised the expansion of electronics industry in India.
  • Over the last eight years, the compound annual growth rate has been 17%, with a production benchmark of $105 billion, including $11 billion in mobile phone exports.

New changes introduced

  • The budgetary allocation for the PLI plan for IT hardware production is Rs 17,000 crore.
  • The incentive rate has been raised to 5%, providing a greater benefit to businesses who invest in domestic production.
  • An extra optional incentive for using domestically produced components has been created, albeit the particular rates of these incentives have not been stated.
  • If the optional incentives are used correctly, the overall reward under the programme might be 8-9%.

Telecom hardware production achievements

  • Telecom hardware manufacturing exceeded the expected 900 crore and achieved 1,600 crore.
  • Some Indian firms have become big global exporters of complicated radio equipment.
And get notified everytime we publish a new blog post.