The implementation of the majority of production-linked incentive schemes committed by the Centre has been delayed, according to a report by the analytics firm CRISIL.

CRISIL’s report on Thursday noted that “incentives for complex sectors under the PLI scheme, which was introduced in April 2020 to provide capital expenditure-linked incentives to 14 key sectors, are expected to peak in fiscal 2026 due to delays in scheme implementation”.

Of 14 schemes, nearly eight got government approval only in 2022, thereby delaying capital expenditure, while the incentive payouts for four schemes begin only in fiscal 2025, according to the report.

Improving competitiveness

In a bid to reduce import dependence, the government had set up PLI schemes across 14 sectors to bolster existing manufacturing value chains and thus improve competitiveness to support exports as well.

The Centre expects a revenue potential between ₹25-30 lakh crore with incentives worth ₹1.86 lakh crore expected to be disbursed.

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“However, the effort required for formulating the scheme for complex sectors such as advanced chemistry cell (ACC) batteries and solar modules led to eight out of 14 sectors getting government approval for implementation of the scheme only in 2022. Therefore, the scheme may see capital spent closer to what the government visualised but at a staggered pace,” the Crisil report added.

Sectors such as pharma, mobile, white goods and IT hardware were one of the first to get approval for their PLI schemes. Auto, textile, drones got their approvals much later.

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