Ministry of Heavy Industry publishes the guidelines on Production Linked Incentive (PLI) scheme for Automobile and Auto components.

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The Ministry of Heavy Industry on 23rd September 2021 has published the Production Linked Incentive (PLI) scheme for Automobile and Auto components which proposes financial incentives to boost domestic manufacturing of Advanced Automotive Technology 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 areas of Advanced Automotive Technology products.

The scheme consists of two components incentivizing incremental sales of automobile and auto components related to Advanced Automotive Technology.

The Incentives are applicable from 2022-23, to be given in 2023-24, for a total of five financial years consecutively. An approved applicant would not be eligible for any benefits beyond the financial year ending March 31, 2027. The financial year 2019-20 would be considered as the base year for the calculation of eligible sales value.

The scheme is designed to incentivize Advanced Automotive Technology products only viz eligible Advanced Automotive product on standalone basis at component level or in integration with the vehicle having appropriate value apportionment on the vehicle side. Therefore, an approved legal entity as Automotive OEM company or New Non-Automotive Investor company can avail incentives under both components of the scheme subject to the condition that any eligible product shall be incentivized only once under the scheme.Any double claim of incentive for the same product under component level and vehicle level can lead to disqualification of the legal entity/entities involved on this ground alone in addition to any other legal action as applicable under the law.

The window for receiving applications through the Notice Inviting Applications will be for a period of 60 days. The applicant companies are required to submit an application along with financial & supporting documents.

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