Union Budget 2021: Production linked incentive schemes announced for 13 sectors
As finance minister Nirmala Sitharaman presented the union budget on February 1, she announced that the government aims to spend ₹1.97 lakh crore on various PLI schemes over the next 5 years, starting from this fiscal. This will be an addition to the ₹40,951 crore announced for the PLI for electronic manufacturing schemes.
The production linked incentive scheme (PLI) for large-scale electronics manufacturing serves the purpose of providing incentives to producers. This will be a major step ahead in making India a hub for manufacturing and exports. Under the scheme, eligible players will receive incentives ranging from 4 per cent to 6 per cent of production value for five years, after they achieve their investment and production value target for each year.
The move is likely to attract global players in the manufacturing sector and make India globally competitive by attracting investment. The scheme also aims to encourage local companies to set up or expand existing manufacturing units in the country. The move is significant for the manufacturing sector in a time as it faces a crisis because of the ongoing coronavirus pandemic.
The scheme was also a part of the Economic Survey that was tabled in the Parliament on Friday. In the Survey, the government said that the scheme will make "Indian manufacturers globally competitive, attract investment in the areas of core competency and cutting-edge technology." The Survey added that the scheme will also establish backward linkages with the MSME sector in the country, which, in turn, "will lead to more inclusive growth and create huge employment opportunities".
In November 2020, the central government approved a ₹1.45 trillion the PLI scheme for ten sectors which included advance chemistry cell (ACC) battery used in consumer electronics, electric vehicles, renewable energy; electronic and technology products; automobiles and automobile components; pharmaceutical drugs; telecom and networking products; textile products; food products; solar PV modules; air conditioners, LEDs and speciality steel.
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- The meeting will be held virtually this year due to the ongoing Covid-19 pandemic.
- The rule is to ensure that high net worth individuals who post huge sums of money per month in their EPF accounts do not get to misuse the provision of assured high interest.
- Pandey said the move is aimed at ensuring that government presence is not required in the private sector and foreign investments.