Effect of PLI scheme: Mahindra and Tata Motors got incentives of Rs 246 crore
Under the PLI scheme, an investment of Rs 20715 crore has been made in the automotive sector. Products worth Rs 10472 crore have also been sold till this period. Under this scheme, the company can claim incentives only if there is at least a 50 percent value addition in the products at the domestic level and an increase in sales at both domestic and export levels.
Now the effect of the Production Linked Incentive (PLI) scheme is visible in the automotive sector after electronics and pharma. For the first time under the PLI scheme, Tata Motors and Mahindra & Mahindra have claimed incentives in the current financial year 2024-25, and their claim has been approved. The PLI scheme was announced for the automotive sector in September 2021. This scheme was launched to increase the production of Advanced Automotive Technology (AAT) products in the country as well as establish a strong supply chain in the automotive sector. Under this scheme, the company can claim incentives only if there is at least a 50% value addition in the products domestically and an increase in sales at both domestic and export levels.
The Ministry of Heavy Industries informed that an investment of Rs 20,715 crore had been made in the sector under the PLI scheme till September this year while products worth Rs 10,472 crore have been sold so far. According to the Ministry, for the first time during the current financial year of 2024-25, firms are going to get incentives through this very PLI scheme. Mahindra & Mahindra has claimed a subsidy of Rs 104.08 crore in the name of increased manufacturing and sale of electric three-wheeler and AAT products of the company. So far, Mahindra & Mahindra has invested Rs 978.30 crore and in the last fiscal 2023-24, a sale of more than Rs 800 crore was incurred by the company.
It claimed incentives of Rs 142.13 crore for the production and sale increase of Tiago EV, Starbus EV, and Ace EV under the PLI scheme. These vehicles along with AAT products were sold by Tata Motors at a value of Rs 1380 crore in the last financial year. According to the Heavy Ministry, both companies have claimed incentives of Rs 246 crore and after examining these claims by the Project Management Agency, the ministry has approved it. To encourage Make in India, the government announced the PLI scheme in 14 sectors between the year 2020-22. The electronics sector has received a big benefit of the PLI scheme.
