Govt may expand PLI to beyond 14 sectors

NEW DELHI: The government is dealing with a pile of proposals – from coal gasification to food items and chemicals – to be included under the production-linked incentive (PLI) scheme for which Rs 2 lakh crore has been allocated over a five-year period. There are indications that the government may expand the coverage to include a few more sectors.
Already 14 sectors, ranging from electronic goods to key pharma ingredients, speciality steel and drones, are part of the scheme that was announced under a plan to turn India into a manufacturing base for domestic and international markets and in the process reduce dependence on imports.
But even as the companies that will get into these sectors are finalised, ministries have joined the bandwagon to propose one sector after another, with officials fearing that the entire focus would be diluted.
The wishlist includes sectors such as bicycles, more items from the textiles (beyond technical textiles), a plethora of chemicals, containers, toys and footwear. In certain cases detailed notes have also been floated with some of them making it to the level of clearance at a panel of officers.
“The whole idea was to move to scale instead of providing incentives to lakhs of exporters. We should stay the course,” said a key government functionary, arguing against the dilution of focus.
The finance ministry had held its ground on increasing the outlay beyond the promised Rs 2 lakh crore and any expansion will result in less allocation for the identified sectors, an official warned. There are also demands from ministries such as electronics and IT to increase the allocation for some of the products that are part of the PLI basket.
Officials said in several cases looking at policy deficiencies will help address sectoral issues and pointed to availability of quality leather as one of the areas. Similarly, some of the global companies have pointed out that they are willing to scale up their operations in the identified sector without financial support from the government but will need assistance in developing an ecosystem of MSMEs and vendors to meet higher requirements, which are currently being imported in large quantities.

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