Atmanirbhar Bharat: PLI Initiatives Drive Rs 1.97 Lakh Crore in Economic Growth

In a significant move towards achieving self-reliance under the ‘Atmanirbhar Bharat’ vision, India’s Product-Linked Incentive (PLI) schemes have emerged as a transformative force, enhancing the nation’s manufacturing and export capabilities with an outlay of ₹1.97 lakh crore (over US$26 billion).

Launched in November 2020 by the Ministry of Commerce and Industry, the PLI initiative covers 14 key sectors and has already achieved notable milestones. The program has catalyzed investments worth ₹1.46 lakh crore (USD 17.5 billion), spurred production and sales amounting to ₹12.50 lakh crore (US$150 billion), and boosted exports to ₹4 lakh crore (USD 48 billion). Furthermore, it has created direct and indirect employment for 9.5 lakh individuals. As of FY 2023-24, ₹9,721 crore in incentives have been disbursed, reflecting the scheme’s tangible impact.

PLI scheme has significantly expanded India’s manufacturing footprint across 14 vital sectors

The PLI scheme has significantly expanded India’s manufacturing footprint across 14 vital sectors, including Mobile Manufacturing, Pharmaceuticals, Automobiles, Specialty Steel, Telecom, and Advanced Chemistry Cell (ACC) Batteries. Over 1,300 manufacturing units have been established across 27 states and union territories, overseen by 10 Ministries and Departments. This widespread decentralization has fueled industrial growth in diverse regions, marking it as a nationwide success.

A noteworthy aspect of the PLI scheme is its cascading effect on the Micro, Small, and Medium Enterprises (MSME) ecosystem. The establishment of anchor units in various sectors has created a demand for a robust supplier base, leading to the development of many ancillary manufacturing units within the MSME sector. This linkage is expected to fortify the entire value chain and boost MSME growth.

The PLI scheme for White Goods, which includes air conditioners and LED lights, stands out as a key success story. With an approved outlay of ₹6,238 crore for FY 2021-22 to FY 2028-29, the initiative has already achieved 47% of its committed investment target of ₹6,962 crore and generated 100% of the envisaged direct employment, employing 48,000 individuals as of September 2024. The domestic value addition in this sector is projected to rise significantly from 20-25% to 75-80% by the scheme’s conclusion. Encouraged by the robust industry response, the third round of applications for this segment attracted 38 new applicants with potential investments of ₹4,121 crore.

The 14 focus sectors under the PLI scheme include Mobile Manufacturing and Electronic Components, Pharmaceuticals and Medical Devices, Automobiles and Auto Components, Advanced Chemistry Cell Batteries, High-Efficiency Solar PV Modules, and Drones and Drone Components, among others.