PLI scheme extended till 2028, Tata Motors and Mahindra benefit
What's the story
The Indian government has extended the production-linked incentive (PLI) scheme for the automotive sector by one more year, until March 2028.
The reason behind the move is to bolster local manufacturing with a focus on electric vehicles (EVs).
Tata Motors and Mahindra recently received domestic value certificates, allowing them to benefit from the scheme. Tata Motors has four PLI-approved models, while Mahindra has eight.
Application
Major automakers seek PLI certification
Mahindra and Tata are not the only ones to apply for the PLI benefits.
Other major firms that have applied for certification under the PLI scheme include Toyota, Ola Electric, and TVS Motor Company. Out of 23 models applied for, only 12 have been approved so far.
The Centre expects 23 more companies to apply for certification by next month.
Details
Centre wants to boost local production
Launched in April 2022, the PLI scheme encourages the sales of advanced automotive technology (AAT) products made in India.
It offers incentives to automakers producing electric or hydrogen-powered vehicles and manufacturers of high-value, high-tech components.
Union Minister Mahendra Nath Pandey announced that the Rs. 25,938 crore scheme was extended after a review.
Insights
PLI scheme has 2 parts
The PLI scheme is divided into two parts. The first is Champion OEM, which comprises carmakers producing electric or hydrogen-powered vehicles.
The next is Component Champions, which covers producers of high-value and high-tech components.
Automobile giants like Hyundai, Bajaj Auto, Hero MotoCorp, Eicher Motors, Kia Motors, and Suzuki, have qualified for the Champion OEM category.