Cabinet may approve revised PLI scheme for auto sector on Wednesday

The Union Cabinet is likely to approve on Wednesday the revised production-linked incentive (PLI) scheme for the automobile sector, which aims at promoting domestic manufacturing and create jobs, according to sources. The government is believed to have slashed the outlay for this PLI scheme to about Rs 26,000 crore, they said.

Last year, the government had announced the scheme for the automobile and auto components sector with an outlay of Rs 57,043 crore, earmarked for five years.

"The Cabinet may take up the proposal in the meeting tomorrow (on Wednesday)," one of the sources said.


The sources did not disclose the reason for revising the scheme to Rs 25,938 crore, but stated that the focus is now more on battery electric and hydrogen fuel cell vehicles.

Component segments that are expected to be covered under the scheme include automatic transmission assembly, electronic power steering system, sensors, supercapacitors, sunroofs, adaptive front lighting, automatic braking, tyre pressure monitoring system, and collision warning system.

Earlier, auto industry body SIAM said the scheme announced by the government will increase competitiveness and take the growth of the sector to the next level.

The scheme for the sector is part of the overall production-linked incentives announced for 13 sectors in the Union Budget 2021-22 with an outlay of Rs 1.97 lakh crore.

The PLI scheme will help bring scale in key sectors and create and nurture global champions.