Centre weighs reopening PLI scheme for white goods to boost manufacturing: Report

In an effort to assess industry interest, a senior DPIIT officer recently communicated directly with CEOs of leading companies, soliciting their intent to invest under the PLIWG scheme under existing guidelines.

The government is planning to reopen the production-linked incentive scheme for white goods (PLIWG) following a sluggish start in domestic production of key components like compressors, copper tubes, and aluminium foils, reports The Economic Times.

The scheme targets enhancing the production capacity of air-conditioner and LED light components.

The ET report, quoting sources familiar with the matter, said that the Department for Promotion of Industry and Internal Trade (DPIIT) has reached out to major industry players and beneficiaries of the scheme to gauge their interest in further investments if the PLIWG scheme is reinstated. Approximately Rs 1,500 crore of the PLIWG incentive pool remains unallocated due to fewer proposed investment projects in high-value components. Out of the total proposed investments of Rs 6,766 crore, about Rs 2,000 crore is yet to be materialised.

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The report also added that the government aims to utilise the unallocated incentive corpus to attract substantial investments, particularly in high-value manufacturing components, as part of its strategy to promote domestic manufacturing, reduce import dependence, and generate employment opportunities. The PLIWG scheme, with an outlay of Rs 6,238 crore, is slated for implementation from FY22 to FY29.

In an effort to assess industry interest, a senior DPIIT officer recently communicated directly with CEOs of leading companies, soliciting their intent to invest under the PLIWG scheme under existing guidelines. The message highlighted the growth potential of the room air-conditioner and LED lights manufacturing sector in India, supported by economic conditions, environmental considerations, government initiatives, and evolving consumer preferences.

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Several large companies have responded with fresh investment proposals. Notably, the PLIWG scheme emphasises domestic value addition, aiming to increase it from 15-20 percent in FY22 to 75-80 percent by FY29 for air-conditioners and LED lights. Industry executives suggest the scheme has been instrumental in significantly reducing imports of components such as heat exchangers, inverter PCB boards and sheet metals.

The ET reports that Jasbir Singh, CEO of Amber Enterprises, India’s largest AC contract manufacturer, acknowledged the scheme's success but pointed out that critical components like compressors, inner grooved copper tubes, and aluminium foils for heat exchangers still rely on imports. Panasonic India Chairman Manish Sharma echoed similar sentiments, lauding PLIWG as one of the most successful PLI schemes while underscoring the need to address remaining import dependencies.