NEW DELHI: After a tepid response to the earlier version of the Production-linked Incentive (PLI) scheme for large electronics, the government on Wednesday approved the PLI 2.0 for IT hardware with a budgetary outlay Rs 17,000 crore.
The scheme will cover IT hardware covers laptops, tablets, all-in-one PCs, servers and ultra small form factor devices. The government expects the scheme, which will remain in force for six years, will lead to incremental production of Rs 3.35 lakh crore, investment of Rs 2,430 crore and create direct employment for 75,000 people during the scheme period.
The earlier version of the PLI for large electronics received a tepid response as cash incentives given under that plan ranged from 1-4% of the incremental sales. Telecom minister Ashwini Vaishnaw said the earlier version offered 2% incentives, which was quite low, whereas in the 2.0 version, the base incentive would be 5%. “In last nine years, electronics manufacturing has increased from a miniscule amount to a significantly large amount. In the last financial year, it has almost touched a major landmark of $105 billion (about Rs 8,65,000 crore) electronics manufacturing in India. There is very good progress in electronics manufacturing overall,” Vaishnaw said.
He further said within that subset in PLI scheme, the telecom and mobile phone manufacturing is going very strong. “So, continuing that momentum, the Prime Minister has approved a comprehensive PLI scheme for IT hardware,” said the telecom minister Ashwini Vaishnaw.
Vaishnaw added that the mindset regarding electronic manufacturing has changed in past eight years. Earlier, people would think of importing electronic items, now India manufactures cater to not just domestic demand, but also export.
“PLI 2.0 scheme for IT hardware sector aims to boost domestic manufacturing and attract large investments and jobs in coming years. This scheme will play a key role in catalysing India’s Techade and in achieving the $1 trillion Digital Economy goal - including $300 billion of electronics manufacturing by 2025-26,” said Rajeev Chandrasekhar, Minister of State for Electronics and Technology. The government had introduced the PLI scheme for IT hardware in March 2020. The budget outlay for the first scheme was Rs 7,350 crore. The scheme offered incentives ranging 4% to 1%.