The government has reopened the application window for the Production Linked Incentive (PLI) scheme for white goods (PLIWG), for the manufacture of components and sub-assemblies of ACs and LED lights, for about three months, on the same terms and conditions as before.
To maintain liquidity in the business, better working capital management, and enhance operational efficiency of beneficiaries, quarterly claims processing of PLI is to be introduced in place of claims processing on an annual basis, it added.
“In order to avoid any discrimination, both new applicants as well as existing beneficiaries of PLIWG, who propose to invest more by switching to a higher target segment, or their group companies applying under a different target segment, would be eligible to apply subject to fulfilling the eligibility conditions…,” a release issued by the Commerce & Industry Ministry noted.
Reopening the application window, for the period from July 14, 2024, to October 15, 2024, will allow fuller utilisation of the Rs 6,238 crore approved outlay for the scheme to be implemented over a seven-year period, from FY22 to FY29.
However, applicants will only be eligible for incentives for the remainder of the scheme’s tenure. “The applicant approved in the proposed third round would be eligible for PLI for a maximum three years only in the case of new applicants and existing beneficiaries opting for investment period up to March 2023, seeking to move to a higher investment category. For existing beneficiaries opting for investment period up to March 2022, seeking to move to a higher investment category in the proposed third round, would be eligible for PLI for a maximum two years,” the release stated.
In case existing beneficiaries are unable to achieve the threshold investment or sales in a given year, they will be eligible to submit the claims as per their original investment plan. However, this flexibility will be provided only once during the scheme period.
“The application window for the scheme is being reopened based on the appetite of the industry to invest more under the scheme, which is an outcome of the growing market and confidence generated due to the manufacture of key of AC and LED Light components in India under the PLIWG Scheme,” the release said.
The PLI scheme for white goods for the manufacture of components and sub-assemblies of ACs and LED lights was approved by the Cabinet on April 7, 2021, to promote ‘Atmanirbhar Bharat’ in the sector.
Following consultations with the industry, which pitched for easier norms, the Department for Promotion of Investments and Internal Trade (DPIIT), the nodal Department for the PLIWG, made some changes in the rules in October last year. It decided to adopt the cost-plus method in place of the CUP (comparable uncontrolled price) method to calculate sales prices in case of captive consumption or supplies to group companies. Investments in tool room for the manufacture of moulds and dies were considered eligible investment under capital investment.
An additional year, over and above two years permitted for informing beneficiaries about the establishment of an additional manufacturing facility, was allowed. Other changes included revision of the last date of submission of filing the claim and refund of excess incentive by the beneficiary on account of discrepancy and roll-over of bank guarantee.
So far, 66 applicants with committed investment of ₹6,962 crore have been selected as beneficiaries under the PLI scheme. Companies such as Daikin, Voltas, Hindalco, Amber, Panasonic, Blue Star, Haier and IFB have invested in manufacturing components for air-conditioners.
Companies such as Dixon, Surya, Orient, Cromption Greaves, Radhika Opto and Luker have invested in manufacturing components of LED lights.