Ashwini Vaishnaw, Minister of Electronics and Information, said on November 18 that 27 businesses had been authorized for Production Linked Incentive (PLI) programs for IT gear.
“Twenty-three of these companies are ready to start manufacturing on day zero. And four companies will start within 90 days. These 27 companies will lead to Rs 3,000 crore, direct employment of 50,000, and indirect employment of 1,50,000,” Vaishnaw said.
Previously, 40 businesses, including Dell, HP, and Lenovo, had registered for the IT hardware PLI scheme, pledging to manufacture personal computers, laptops, tablets, servers, and other equipment worth Rs 4.65 lakh crore over the program time.
Dell, Foxconn, HP, Lenovo Flextronics, VVDL, Neolink, Bhagwati, Netweb, Sahasra, ILP, and Optimus are among the firms that have been certified.
“Companies that have not been approved, they are evaluating, and they will also come,” Vaishnaw further noted.
The Cabinet authorized a revamped PLI program for IT hardware worth Rs 17,000 crore with a six-year duration in May, to increase local production of laptops, tablets, all-in-one PCs, servers, and ultra-small form factor devices. It is expected to drive additional output of Rs 3.35 lakh crore and create 2 lakh jobs.
The previous iteration of the plan provided incentives of up to 2% of net sales of locally made items. The latest version increases the baseline incentive level to more than 5%.
Furthermore, the new scheme aims to promote domestic manufacturing of smaller components in computing devices by offering additional incentives of up to 3% to companies that buy domestically produced components such as memory chips, printed circuit board assemblies, solid-state drives, chassis, power supply components, and adaptors.
The Production Linked Incentive Scheme, or PLI Scheme, is an initiative launched by the Government of India to encourage not only foreign companies to find a workforce in the country and thus generate employment but also domestic and local production to create micro-jobs.
The PLI plan, as the name implies, is a program that gives incentives to domestic industries to increase domestic output. When this occurs, particularly specialized goods arise that cater to a certain segment of the target demographic. Domestic firms also contribute to lower import costs. According to the PLI program, the government encouraged domestic enterprises and institutions to develop or expand manufacturing units to enhance output, in exchange for government incentives on additional sales.
According to the PLI scheme update in November 2020, the scheme aimed to include ten more labor-intensive sectors of production, such as food processing, textiles, and so on, in addition to the existing sectors such as allied equipment for mobile phones and assembly, pharma, and medical devices.