About PLI scheme extension and employment opportunities in electronics: Report

The scheme was slated to begin in 2020-21 and continue for five years. This will now continue till 2025-26, she said. Participating companies will now get five more years for meeting their production targets. The extension was due to production delays and component shortages amidst COVID-19.

About the PLI scheme

High-end televisions, air compressors for air conditioners, laptop processors, CPU chips as well as smartphones are imported from markets like China. Amidst the Coronavirus outbreak and calls to boycott Chinese goods, Prime Minister Narendra Modi had called for Aatmanirbhar Bharat (self-reliant India) in a speech in May 2020.

Following this, in November 2020, the Union cabinet approved the PLI scheme for 10 sectors.

These are pharmaceuticals, automobiles and auto components, telecom and networking products, advanced chemistry cell battery, textile, food products, solar modules, white goods, specialty steel, and high efficiency solar PV modules.

The PLI scheme for white goods became operational on April 1, 2021. Under this, eligible players in the air-conditioner and LED manufacturing space will be offered incentives worth Rs 6,238 crore over five years.

Over and above this, the scheme for laptops and IT hardware has a total size of approximately Rs 7,350 crore over four years.

It also incorporates cash incentives of 4-6 percent on incremental sales made over the base year of 2019-20 for five years. This means that companies will be eligible for incentives only if they exceed the production numbers of the base year.

How will it benefit employment?

The finance minister said that companies were not able to meet targets due to movement restrictions, lockdowns, delay in plant/machinery installations and disruptions in supply chain.

Shreegopal Kabra, Managing Director & Group President, RR Global, said that the extension of the scheme would benefit companies which have already made investments under the scheme.

"These companies couldn't complete their mandatory targets due to the pandemic . The revised scheme will also attract many new companies," he added.

When it comes to electronics products like laptops and tablets, Ravi Shankar Prasad, Union Minister for Electronics and Information Technology, had earlier said that the total production will be worth Rs 3.26 lakh crore over the next five years, of which about 75 per cent will be for export.

Apart from building manufacturing facilities locally, the government said that the PLI scheme has the ability to create over 1,80,000 jobs (direct and indirect) over four years.