The Ministry of Heavy Industries has extended the Production-Linked Incentive (PLI) scheme for automobiles and auto parts by one year. The decision was taken after the Empowered Group of Secretaries (EGoS) approved it.
The Department has also changed the scheme to provide more clarity and flexibility. The preferential treatment under the revised system will be applied for five consecutive fiscal years starting in fiscal 2024. The previous duration of this system was from his 23rd year to his 27th year.
However, due to the strict standards, only a few companies were able to qualify. As a result, the industry sought extensions to payment dates and deadlines. This will ensure that businesses that fail to qualify for incentives in the first year of the scheme will not miss out on a full year of incentives.
This incentive will be paid in the next financial year, FY25. An approved applicant will be eligible to receive benefits for five consecutive fiscal years, but no later than March 31, 2028.
If an approved company does not meet the criteria for a determined increase in sales over the first year’s criteria, it will not receive an incentive for that year.
However, businesses can still receive benefits the following year if they meet a threshold calculated based on 10% year-on-year growth over the first year’s threshold. This provision ensures fairness for all approved companies and protects those that choose to bring forward their investments.
The amendment also includes changes to the table showing incentive expenditure, bringing the total incentive amount to Rs 25,938 crore.
(Editor: Ajay Vaishnav)