“We welcome the implementation of the PLI scheme on telecom equipment. Telecom is the backbone of a digitally connected India and this initiative will further boost local manufacturing and create employment opportunities. India is already the second largest telecom market globally and this will go a long way in making the country a global hub for telecom innovation.”
Though nearly half of the Rs 7325-crore budget allocated for the PLI scheme for IT hardware, it is likely to go unused with the applicant companies such as Dell, Wistron, Flextronics, Foxconn cumulatively committing to produce far lower than expected by the government. Manufacturers are piqued over the low incentive structure of the scheme which offers only 1%-4% reward and does not compensate for the disabilities of shifting production to India of duty-free products like laptops, tablets and data servers from countries like China and Taiwan.
Thus, the 19 applicants of the scheme have pledged to produce goods only upto minimum eligibility threshold or goods worth Rs 1.60 lakh crore, including Rs 60,000 crore of exports over the four-year period of the scheme. This is sharply lower than the government’s estimate of achieving production output worth Rs 3.26 lakh crore, of which exports were expected to be worth Rs 2.45 lakh crore