Production Linked Incentive, or PLI, scheme of the
Government of India
The Government of India (ISO 15919, ISO: Bhārata Sarakāra, legally the Union Government or Union of India or the Central Government) is the national authority of the Republic of India, located in South Asia, consisting of States and union t ...
is a form of
performance-linked incentive to give companies incentives on incremental sales from products manufactured in domestic units. It is aimed at boosting the
manufacturing sector
In macroeconomics, the secondary sector of the economy is an economic sector in the three-sector theory that describes the role of manufacturing. It encompasses industries that produce a finished, usable product or are involved in construction ...
and to
reduce imports.
[ Objective of these schemes entail ]Make in India
is an initiative by the Government of India to create and encourage companies to develop, manufacture and assemble products in India and incentivize dedicated investments into manufacturing. The policy approach was to create a conducive envi ...
, incentivising foreign manufacturers to start production in India and incentivise domestic manufacturers to expand their production and exports.[ For example, one of these sectors is the ]Automotive industry in India
The automotive industry in India is the world's fourth-largest by production and valuation as per 2022 statistics. As of 2025, India is the ''3rd largest automobile market'' in the world in terms of sales.
, India's auto industry is worth mor ...
, for which GoI introduced 3 schemes, a Rs. 26,000 cr (US$3.61 b) scheme for production of electric vehicle
An electric vehicle (EV) is a motor vehicle whose propulsion is powered fully or mostly by electricity. EVs encompass a wide range of transportation modes, including road vehicle, road and rail vehicles, electric boats and Submersible, submer ...
s and hydrogen fuel vehicles (PEVHV), the Rs 18,000 crore (US$2.5 b) ''"Advanced Chemistry Cell"'' (ACC) scheme for new generation advance storage technologies for the electric vehicles, and Rs 10,000 crore (US$1.4 b) ''"Faster Adaption of Manufacturing of Electric Vehicles"'' (FAME) scheme to go green by expediting production of more electric vehicles and replacement of other types of existing vehicles with the greener vehicles.[ The PLI scheme to boost automotive sector to encourage the production of electric vehicles and hydrogen fuel vehicles will also generate 750,000 direct jobs in auto sector.][ These schemes will reduce pollution, climate change, carbon footprint, reduce oil and fuel import bill through domestic alternative substitution, boost job creation and economy.][India doesn’t need speed breakers. Modi govt right to help automobile, telecom]
The Print, 17 September 2021. Society of Indian Automobile Manufacturers
The automotive industry in India is the world's fourth-largest by production and valuation as per 2022 statistics. As of 2025, India is the ''3rd largest automobile market'' in the world in terms of sales.
, India's auto industry is worth mor ...
welcomed this as it will enhance the competitiveness and boost growth.[Cabinet Clears ₹ 26,000 Crore Scheme For Auto Sector To Boost Production]
NDTV, 15 September 2021. In March 2025, Reuters reported that India's $23 billion Production-Linked Incentive (PLI) scheme, launched in 2020 to boost domestic manufacturing and compete with China, was set to lapse after failing to meet expectations. The initiative, aimed at attracting investments in key sectors like electronics, pharmaceuticals, and automobiles, disbursed only $1.7 billion of the allocated funds by March 2025. Challenges such as complex regulations, delays in approvals, and insufficient incentives led to underwhelming participation from global manufacturers, prompting the Indian government to consider revising the scheme to enhance its effectiveness.
List of industries
The government has introduced the scheme for several industries which include:'Production Linked Incentive (PLI) Schemes in India', ''Government of India''
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# Auto components
# Automobile
A car, or an automobile, is a motor vehicle with wheels. Most definitions of cars state that they run primarily on roads, Car seat, seat one to eight people, have four wheels, and mainly transport private transport#Personal transport, peopl ...
# Aviation
Aviation includes the activities surrounding mechanical flight and the aircraft industry. ''Aircraft'' include fixed-wing and rotary-wing types, morphable wings, wing-less lifting bodies, as well as lighter-than-air aircraft such as h ...
# Chemicals
# Electronic systems
# Food processing
# Medical devices
# Metals & mining
# Pharmaceuticals
Medication (also called medicament, medicine, pharmaceutical drug, medicinal product, medicinal drug or simply drug) is a drug used to diagnose, cure, treat, or prevent disease. Drug therapy ( pharmacotherapy) is an important part of the ...
# Renewable energy
Renewable energy (also called green energy) is energy made from renewable resource, renewable natural resources that are replenished on a human lifetime, human timescale. The most widely used renewable energy types are solar energy, wind pow ...
# Telecom
# Textiles & apparel
# White goods
A major appliance is a non-portable or semi-portable machine used for routine housekeeping tasks such as cooking, washing laundry, or food preservation. Such appliances are sometimes collectively known as white goods, as the products were tradi ...
# Drones
References
{{Reflist
Economy of India
Government programmes of India
Modi administration initiatives