Revolutionizing Indian Industries: A closer look at PLI schemes

The Performance Linked Incentive (PLI) Schemes have showcased remarkable success, with exports under the targeted sectors exceeding Rs 3.20 lakh crore (US$ 38.5 billion). Major contributions come from sectors including large-scale electronics manufacturing, pharmaceuticals, food processing, and telecom & networking products.

Till now, 746 applications have received approval across 14 sectors, indicating anticipated investments surpassing INR 3 lakh crore. This substantial growth underscores the positive impact of the PLI initiatives on diverse industries.

India’s Production Linked Incentive (PLI) Schemes have achieved remarkable success, achieving exports over INR 3.20 lakh crore and investments beyond INR 1.03 lakh crore, according to a recent release by the Government of India. The impact is being witnessed across sectors, particularly electronics, pharmaceuticals, and food processing.

With 746 approved applications and 176 MSMEs, the schemes are fostering collaborative growth, promoting employment, innovation, and global competitiveness. These schemes are aimed at positioning India at the forefront of global value chain, shaping a future defined by innovation, economic growth, and self-reliance in line with the vision of ‘Atmanirbhar Bharat.

PLI Transforming India’s industrial landscape

• PLI Schemes have witnessed a cumulative investment of over Rs 1.03 lakh crore (US$ 12 billion) till November 2023. This infusion of capital has resulted in a substantial production/sales figure, reaching Rs 8.61 lakh crore (US$ 103.6 billion).
• Employment generation, both direct and indirect, has surged to over 6.78 lakh, providing a significant boost to the workforce.
• Exports under PLI Schemes have soared past Rs 3.2 lakh crore (US$ 38.5 billion), with key contributions from sectors like Large-Scale Electronics Manufacturing, Pharmaceuticals, Food Processing, and Telecom & Networking products.
• 746 applications have been approved in 14 sectors, indicating a prospective investment exceeding INR 3 lakh crore.
• The inclusion of 176 MSMEs across sectors like Bulk Drugs, Medical Devices, Pharma, Telecom, White Goods, Food Processing, Textiles & Drones showcases a collaborative approach.
• PLI Schemes have disbursed around Rs 4,415 crore (US$ 531 million) across 8 sectors, fostering growth and innovation.

Notably, the localization of electronic components, including batteries, chargers, and PCBAs, has witnessed substantial advancements, contributing to the country’s self-reliance in this crucial sector. Despite constituting only 20% of market share, PLI beneficiaries have accounted for 82% of mobile phone exports, showcasing its impact on boosting global competitiveness. Furthermore, the surge of approximately 254% in Foreign Direct Investment (FDI) in Large-Scale Electronics Manufacturing (LSEM) reflects global confidence in India’s manufacturing capabilities.

The PLI Scheme has demonstrated its effectiveness in reducing imports of raw materials in the pharmaceutical sector, promoting self-sufficiency and resilience. In the healthcare sector, India’s prowess is evident with the production of 39 medical devices, ranging from CT-Scans to Heart Valves – highlighting the nation’s growing stature in healthcare manufacturing. Import substitution in the telecom sector has reached 60%, while sales of Telecom & Networking Products by PLI beneficiaries have experienced a remarkable surge of 370%.

The drone industry has seen significant growth, boasting an impressive CAGR of 90.7%, attesting to the vibrancy and potential within this emerging sector. Additionally, the PLI Scheme for Food Processing has not only driven the sourcing of raw materials within India but also positively impacted the income of farmers and MSMEs. Furthermore, the rise in sales of organic products and increasing visibility of Indian brands in the international market through effective branding and marketing underscore the comprehensive success and transformative impact of the PLI Scheme across various sectors.

The overarching goal of PLI Schemes is to make Indian manufacturers globally competitive by attracting investments in core competency areas and cutting-edge technology. Through these efforts, the PLI Scheme seeks to position India as a formidable player on the global manufacturing stage.

One of the significant outcomes of the PLI Schemes is their transformative impact on India’s export landscape. With a deliberate focus on high value-added products, the schemes have played a pivotal role in reshaping India’s exports basket. This shift marks a departure from traditional commodities towards more advanced and sophisticated offerings. By encouraging investments in key sectors and fostering a competitive manufacturing environment, these schemes are instrumental in propelling India towards a more dynamic and globally relevant position in international trade.