On Wednesday, The Union Government launched the scheme for telecom and networking products over five years. The outlay was for INR 12,195 crores for the Production Linked Incentive scheme (PLI) which will be in operation from April 1, 2021.
The aim for the scheme is to make India a global hub for manufacturing telecom equipment and the government has created a conductive environment for ease of doing business.
Ravi Shankar Prasad, the Minister of Communications and IT said, “We will encourage all the domestic manufacturers as well as many international players who are keen to come to India.”
“It is expected that the scheme will bring investments of around 3,000 crores and that 2019-20 will be taken as the base year for consumption, computation of cumulative incremental sales of manufactured goods, net of taxes”, he added.
For micro, small and medium enterprises (MSME’s), the government has kept a minimum threshold at Rs 10 crores and has proposed 1% higher incentive in the first three years. For others, the minimum investments have been kept at 100 crores.
In the coming years, the scheme gives hope to have incremental production of around Rs 2.5 lakh crores with an export of around Rs 2 lakh crores. Further, the scheme is likely to generate 40,000 jobs and tax revenue of around 17,000 crores from telecom equipment manufacturing.
The move made by the government is expected to incentivize the telecom service providers, who are going through a difficult phase, and the government hopes to find success in the similar way in other areas too, by providing similar incentives for boosting the manufacturing of mobile devices.
