‘PLI approved is timely, to help revive sectoral growth’


The Production Linked Incentive (PLI) Scheme approved by the Cabinet for the automobile industry is both progressive and transformational, and the ₹25,938 crore allocated is the highest of all PLIs announced so far, said sector veterans on Wednesday.

The scheme shows the government’s commitment to support the Indian auto industry by incentivising battery electric and hydrogen vehicles and a selected list of auto components, they said.

“The scheme will contribute towards reducing carbon emissions and oil imports with local manufacturing. The Society of Indian Automobile Manufacturers (SIAM) will be happy to engage with the Ministry of Heavy Industries for detailing and fine-tuning, execution and further strengthening the scheme,” Kenichi Ayukawa, President, SIAM said.

Boosting localisation

Tata Motors which sells the highest number of electric cars right now said that several meaningful incentives have been offered across the entire value chain and encouraging production of auto components using advanced technologies will boost localisation, domestic manufacturing and also attract foreign investments.

“This will help component manufacturers strive for scale, which will require setting up of new facilities and create more jobs. With auto being a strategically important sector of the economy, the benefits accrued overall will result in a multiplier effect. This announcement is a significant milestone in India’s journey towards ‘Atmanirbharta’ and will enable the country to join the top echelons of auto manufacturing nations,” Girish Wagh, Executive Director, Tata Motors, said.

Rival Mahindra & Mahindra said that the PLI scheme for auto will drive faster acceptance of sustainable mobility solutions. “India promises to be one of the largest EV markets in the world. This scheme is a giant step in the right direction,” said Anish Shah, MD and CEO, M&M.

Technological shifts

Vikram Kirloskar, Vice-Chairman, Toyota Kirloskar Motor said that the PLI scheme is quite distinct when compared to other sectoral schemes and it addresses existing competitive gaps and aims to foster rapid tectonic technological shifts to leverage opportunities arising from the realignment of global supply chains.

“The PLI scheme also proves to be timely so as to be able to revive the sectoral growth and lay the foundation for the country to become a global auto manufacturing hub. Above all, it will help attract global investments as several automotive players are looking to diversify their supply chains owing to the pandemic and emerging geopolitical scenarios,” he said.

PLI has the potential to substantially increase volumes and will provide a huge opportunity for exports to grow, said Vipin Sondhi, MD & CEO, Ashok Leyland and Vice-President, SIAM. He said the scheme is being announced at an opportune time for India as the auto industry realigns its supply chain globally. India can therefore capitalise on this changing scenario, to become an integral manufacturing base for the world.

“Thrust on incentivising new age technologies will facilitate creation of a state-of-the-art automotive value chain in the country and give a much-needed impetus to manufacturing of cutting edge automotive products in India. Further, with global economies de-risking their supply chains, the PLI will aid India in developing into an attractive alternative source of high-end auto components,” Sunjay Kapur, President, Automotive Component Manufacturers Association, said.



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