Guidelines for Operationalization of Production Linked Incentive Scheme 2.0 for IT Hardware approved

Tags: Science and Technology

Production Linked Incentive (PLI) Scheme 2.0 for IT hardware has been approved in an announcement made by PIB Delhi on July 14, 2023.

An Overview of the News

The plan, with a budget of ₹17,000 crore, aims to grow and expand the IT hardware manufacturing ecosystem in India.

About Production Linked Incentive Scheme 2.0:

• The Production Linked Incentive Scheme 2.0 is a government initiative aimed at boosting domestic manufacturing and attracting large investments in the value chain. 

• The scheme provides a financial incentive to companies operating in specific target segments, such as Laptops, Tablets, All-in-One PCs, Servers, and Ultra Small Form Factor devices.

Eligibility and Implementation:

• To qualify for the PLI 2.0 Scheme, companies, both domestic and global, must meet the eligibility criteria specified in the scheme guidelines. 

• Those meeting the criteria will receive support for manufacturing goods in India within the specified target segment. 

• Companies will be classified as either domestic or global, determining their categorization as Hybrid (Global/Domestic).

Ranking and Selection Process:

• All applicants will undergo a comprehensive ranking process based on the eligibility criteria outlined in the scheme guidelines. 

• The ranking will determine the selection of applicants in each category—global, hybrid, and domestic—taking into account their overall PLI projection and ranking. 

• However, the final selection will be subject to the availability of the budget allocated for the scheme.

Tenure and Base Year:

• The incentives provided under the PLI 2.0 Scheme will be applicable for a period of six years. 

• For calculating the net incremental sales of manufactured goods, the base year considered will be the financial year 2022-23.

Incentives Payout:

• The incentive granted to each company will depend on the net incremental sales of manufactured goods in the target segment compared to the base year. 

• The maximum incentive amounts are capped at INR 45 billion for global companies, INR 22.50 billion for hybrid (global/domestic) companies, and INR 5 billion for domestic companies. 

• These amounts serve as the upper limit for the incentives that can be received by companies under the scheme.