Another initiative under Atmanirbhar Bharat – PLI scheme for Telecom Sector

Speed Post News Network

New Delhi : Pursuant to the extraordinary incentive of PLI being provided by Government of India in various sectors, the Union Cabinet on February 17, 2021, approved the Production Linked Incentive (PLI) Scheme for Telecom and Networking Products.

This approval comes in the wake of very encouraging success of PLI related to Mobile and component manufacturing, which was announced in April 2020 during the height of Covid pandemic. In spite of July 31, 2020, being the last date for applying, it received a resounding response. All major mobile component manufacturers of world are expanding their powerful footprints in India by making investments, starting exports, and giving jobs to thousands of Indians, according to a PIB release.

The Cabinet decision addresses another component of Atmanirbhar Bharat to make India a global hub of manufacturing telecom equipment including core transmission equipment, 4G/5G Next Generation Radio Access Network and Wireless Equipment, Access & Customer Premises Equipment (CPE), Internet of Things (IoT) Access Devices, Other Wireless Equipment and Enterprise equipment like Switches, Routers etc.

1. The scheme was finalised after widespread consultation with stakeholders like manufacturers, industry leaders and associations.
2. The core component of this scheme is to offset the huge import of telecom equipment worth more than Rs 50 thousand crore and reinforce it with “Made in India” products both for domestic markets and exports.
3. The main features of this scheme are: –
   1. The scheme outlay is Rs 12,195 Crores over five years.
   2. The eligibility for the scheme will be subject to achievement of a minimum threshold of cumulative incremental investment and incremental sales of manufactured goods net of taxes.
   3. Financial Year 2019-20 shall be treated as the Base Year for computation of cumulative incremental sales of manufactured goods net of taxes.
   4. For MSMEs, one percent (1%) higher incentive is proposed in year 1, year 2 and year 3.
   5. Minimum Investment threshold for MSME has been kept at Rs 10 Crores and for others at Rs 100 Crore.
   6. Once qualified, the investor will be incentivised up to 20 times of minimum investment threshold enabling them to utilise their unused capacity.
   7. The Scheme will be operational from April 1, 2021.