2024-01-17 03:52:57
New Delhi, Jan 16
The government is setting up a committee to extend the production-linked incentive (PLI) scheme to more products in the automobile and auto components sector. The committee will be chaired by Hanif Qureshi, Additional Secretary in the Ministry of Heavy Industries (MHI).
“There have been repeated demands from automobile industry stakeholders to add more components in the PLI scheme … so, we have decided to set up a committee to oversee such requests. It will be chaired by our Additional Secretary, and industry veteran Pawan Goenka will be an advisor,” Mahendra Nath Pandey, Minister of Heavy Industries, told businessline on the sidelines of an event here.
The 11-member committee would include industry experts from various stakeholders, including test agencies such as the Automotive Research Association of India (ARAI), and representatives from other industry bodies.
The government had approved the PLI Scheme with a total outlay of Rs 25,938 crore over a period of five years. The scheme proposes financial incentives to boost domestic manufacture of ‘Advanced Automotive Technology’ (AAT) products, and attract investments in the automotive manufacturing value chain.
Its prime objectives include overcoming cost disabilities, creating economies of scale, and building a robust supply chain in AAT products. The aim is to promote deep localisation with minimum Domestic Value Addition (DVA) of 50 per cent, and to attract investments and build large-scale manufacturing capacities, the Minister said.
The scheme also sought to give a boost to zero emission technology such as battery electric vehicles (BEV) and hydrogen fuel cell vehicles (HFCV).
The scheme will help the automobile industry move up the value chain into higher value-added products. Till date, 18 companies (11 domestic and 7 foreign) under the ‘Champion OEM’ category, and 67 companies (34 foreign and 33 domestic) under the ‘Component Champion’ category, have been approved under the Scheme, and are implementing the PLI Auto programme.
The total estimated investment made is to the tune of Rs 67,690 crore, including Rs 40,606 crore by ‘Champion OEMs’ and Rs 27,084 crore by ‘Component Champion’s.
Auto PLI scheme: 75 firms offer to invest ₹74,850 cr over 5 years
Mahindra & Mahindra (M&M), Tata Motors, and Ola Electric have been early movers, and have received DVA certification from testing agencies for 22 variants of AAT products.
M&M is the first company to meet DVA criteria in the three-wheeler category, while Tata Motors is the first company to meet the criteria for both the four-wheeler and bus categories.
The tenure of the PLI Scheme for Automobile and Auto Components has also been extended by one year and incentives will be provided for sales for five consecutive financial years (2023-24 to 2027-28), and disbursement of incentives will take place in the following financial year.
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