The Production Linked Incentive (PLI) scheme, which aims to boost domestic manufacturing and exports by attracting large investments, should be extended to sunrise sectors such as aerospace and MRO (maintenance, repair, and overhaul), as well as strategic sectors such as clean energy, the Parliamentary Standing Committee on Commerce has recommended.

Other sectors that could be covered under PLI include those with large imports but low domestic capabilities, like capital goods and construction equipment, service sectors and labour intensive sectors, such as apparel and furniture, the Standing Committee noted in its report on Demands for Grant (2023-24) of DPIIT. The report was tabled in Parliament on March 24.

“The committee is pleased to note that the PLI Scheme has taken off well and has been widely accepted by the targeted key industrial sector. Expansion to cover other sectors could amplify its impact and encourage domestic manufacture of key industrial components,” it said.

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The scheme, which covers 14 key sectors with an approved outlay of Rs. 1.97 lakh crore, has so far received  717 applications from 588 companies, with a total committed investment of Rs 2.74 lakh crore that has been approved, the report noted.

Actual investments of Rs 49,000 crore have so far been reported, and incentive claims of Rs 2,000 crore have been approved, it added.

The PLI schemes were first introduced in India in March 2020 for three industries – mobile manufacturing and electric components, pharmaceutical (critical key starting materials/active pharmaceutical ingredients), and medical device manufacturing. It promotes domestic production by giving incentives on incremental sales.

The scheme was subsequently expanded and now covers 14 sectors, which include automobiles and auto components, specialty steel, telecom & networking products, electronic products, white goods (ACs and LEDs), food products, textile products, solar PV modules, advanced chemistry cell (ACC) battery, and drones and drone components.

The government is considering extending the scheme to sectors such as e-bicycle components, toys, garments, and home accessories (all materials, including cotton), high-end smartphone components, furniture, and leather footwear.

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