PLI Scheme


The government so Far received registration from 58 companies for the Rs. 17,000 crore IT hardware production linked incentive scheme.


PLI Scheme" likely refers to the Production Linked Incentive (PLI) scheme introduced by the Government of India. The PLI scheme is a policy initiative aimed at boosting domestic manufacturing in various sectors by providing financial incentives to companies that produce goods locally.

Key Features of PLI

Incentives for Manufacturing: The scheme offers financial incentives to eligible companies based on their incremental production. In other words, the more a company produces over a base year, the higher the incentives it receives.

Targeted Sectors: The PLI scheme focuses on specific sectors that are considered strategically important for the country's economic growth and self-reliance. These sectors could include electronics manufacturing, pharmaceuticals, textiles, automobiles, and more.

Attracting Investment: The scheme is designed to attract both domestic and foreign investment in manufacturing. By providing financial incentives, the government aims to make India a more attractive destination for companies to set up or expand their manufacturing operations.

Job Creation: Increased manufacturing activity is expected to lead to job creation, helping address unemployment and contributing to economic development.

Export Promotion: The PLI scheme often includes provisions to encourage companies to manufacture products not only for the domestic market but also for export. This can help balance trade deficits and boost foreign exchange earnings.

Performance-Based Incentives: The incentives under the PLI scheme are typically linked to the performance of the participating companies. Companies need to meet certain production and investment targets to qualify for the incentives.

IT hardware production in India: Overview

The Indian government is taking several initiatives to boost IT hardware production in India.

One of the key initiatives is the Production Linked Incentive (PLI) Scheme for IT Hardware, which was announced in May 2023.

The PLI scheme has a budget of INR 170 billion (US$2.05 billion) and aims to attract investments of INR 5.1 trillion (US$62 billion) in the IT hardware manufacturing sector.

The scheme covers laptops, tablets, all-in-one PCs, servers, and ultra-small form factor devices.

The government is also providing other incentives to IT hardware manufacturers, such as tax breaks, duty exemptions, and access to land and power.

These incentives are expected to help India become a major player in the global IT hardware market.

In addition to the government's initiatives, there are several other factors that are driving the growth IT hardware production in India. of

These factors include:

  • The growing demand for IT hardware in India: The Indian IT market is growing rapidly, and this is driving demand for IT hardware.
  • The availability of skilled labour: India has a large pool of skilled labour, which is a major advantage for IT hardware manufacturers.
  • The low cost of manufacturing in India: The cost of manufacturing in India is relatively low, which makes it an attractive destination for IT hardware manufacturers.
  • The government's focus on manufacturing: The Indian government is focused on promoting manufacturing, and this is providing a boost to the IT hardware sector.

As a result of these factors, IT hardware production in India is expected to grow rapidly in the coming years. The PLI scheme is expected to play a major role in this growth, and it is estimated that the scheme could create over 75,000 jobs in the IT hardware sector.

Here are some of the leading IT hardware manufacturers in India:

  • Dell
  • HP
  • Lenovo
  • Acer
  • Samsung
  • Wistron
  • Foxconn
  • Rising Star
  • Bharat Electronics Limited
  • Datawind
  • Lava International

These companies are investing heavily in India and are expected to play a major role in the growth of the IT hardware sector.

Practice Question:

Critically examine the role of a production-linked incentives scheme for boosting IT Hardware production in India.

Posted by on 29th Aug 2023