The government on Monday extended the period of production-linked incentive scheme for large-scale electronics manufacturing with a focus on mobile phones by a year until 2025-26. The base year of the scheme 2019-20 remains the same but the companies will have the option to choose their five-year period either from the base year or the year 2020-21 for calculation of the incentives under the scheme.
"Now we have extended the tenure of the scheme from 2020-21 to 2025-26. Earlier, it would have ended in 2024-25. For those who have made investments even in 2020-21 they will also get counted because we have given them the option of choosing any five years for meeting their production target under the scheme," Finance Minister Nirmala Sitharaman said while announcing new measures to help revive the Covid-hit economy.
The Ministry of Electronics and IT has cleared 16 proposals from domestic and international companies entailing investment of Rs 11,000 crore under the production linked incentive (PLI) scheme to manufacture mobile phones worth Rs 10.5 lakh crore over the next five years.
The companies include iPhone maker Apple's contract manufacturers Foxconn Hon Hai, Wistron and Pegatron, apart from Samsung and Rising Star.
Domestic companies whose proposals have been approved include Lava, Bhagwati (Micromax), Padget Electronics (Dixon Technologies), UTL Neolyncs and Optiemus.
The eligible companies will get 4-6 per cent incentives on incremental sale of companies.
Mobile phone makers' body India Cellular and Electronics Association chairman Pankaj Mohindroo said the extension would not only support the government's efforts to establish India as an integral part of the global value chain in the electronics sector, it will also support developing Indian Champion companies to tap the global as well as Indian markets.
"It is a great win for India. This decision will enable the nation to become a global electronics manufacturing destination and also send the right message to global investors in the pandemic time. It shows that India's governance is deeply compassionate, realistic and always standing behind trade and industry," Mohindroo said.