Commerce and Industry Ministry Piyush Goyal, said as a result of the policy, at least one crore families will benefit as a result of more jobs.
The Union Cabinet on April 7 approved the extension of the Production-Linked Incentive (PLI) scheme for the domestic manufacturing of air conditioners, LEDs and high efficiency solar photovoltaic modules.
"The government wants India to become an important part of the global manufacturing and trade value chain. The list of products chosen for manufacturing incentives have been carefully chosen keeping this in mind. The companies who get benefit under thee scheme, will be chosen based on well defined criteria," Commerce and Industry Ministry Piyush Goyal, said.
The government has announced Rs. 4500 crore worth of benefits for solar PV module manufacturing with an aim to make India 'aatmanirbhar' in the crucial sector of solar panels, Goyal said. The latest move is expected to establish upto 10,000 MW of additional annual manufacturing capacity for solar PV modules and lead to direct employment for 10,000 people.
The PLI benefits will go down to the component level for both ACs and LEDs with 4-6 percent incentive given to manfacturers over the next 5-years.
The minister said the demand for air conditioners in India continue to rise, increasing by 15-20 percent annually. While the the government has banned the import of ACs emitting environmental pollutants beyond a certain limit, components have continued to stream in. The latest move is to curb that import flow, and push up the current 25 percent local value addition done in the manufacturing of air conditioners to upto 75 percent, Goyal said.
The government has also announced benefits worth Rs. 6238 crore for domestic manufacturing of LED bulbs. Goyal said while 85-90 percent of India's domestic LED requirement is being met by domestic production, local value addition has remained stuck at 40-50 percent.
The PLI scheme is an effort to make the industry globally competitive and geared towards production of high value export oriented items. Before this, the government had announced benefits for six sectors. Last week, the Cabinet approved a scheme to promote processed food manufacturing, with an estimated cost of Rs 10,900 crore to the exchequer over the next six years.
Earlier in the year, the Centre had approved Rs 15,000 crore in incentives for domestic manufacturing of pharmaceuticals and Rs 7,350 crore for production of laptops, tablet computers, all-in-one personal computers and servers in the country.
In all, 13 PLI schemes are being implemented by the Centre of which 9 have been approved till now by the Centre. These include benefits for automobiles, IT hardware including mobile phones & telecom equipment, white goods, chemical cells and textiles.
Goyal said after the entire PLI policy is implemented, atleast one crore families will benefit as a result of more jobs.