Samsung finishes PLI marathon first. Prize money: ₹1,000 cr

New Delhi: Samsung is likely to have met the fifth-year target of ₹25,000 crore worth of incremental manufacturing under the smartphone production-linked incentive (PLI) scheme, making the South Korean firm eligible for sops of more than ₹1,000 crore.

The company has started the process of filing for its claims, according to people familiar with the matter, and is likely to become the first to successfully complete the five-year tenure of the scheme.

The fifth year for Samsung ended on March 31 while all other beneficiaries of the scheme, including suppliers of Apple, entered their last year of PLI on April 1.


Samsung has met the targets for each year, barring the second, when it failed to achieve the required production. "Depending on production worth ₹25,000-30,000 crore, Samsung will get ₹1,000-1,200 crore. The claims filed by the company have to be vetted by the government," said one of the persons who did not wish to be identified. Queries sent to Samsung remained unanswered till press time.

To claim the subsidy, companies have to produce handsets with a factory cost of more than $200 (about ₹15,000). FY20 was taken as base year and companies have to achieve incremental sales targets over base year to claim incentives.

Samsung was forced to revise its claims for the first year (2020-21) after the electronics and information technology ministry found some discrepancies in the invoices and held back the incentives. Once the issue was resolved, the government paid Samsung around ₹500 crore for the first year.

A second person said that unlike Apple suppliers, which have been far exceeding the targets and claiming benefits up to ceiling production and even more, Samsung has been meeting the targets.

"The company (Samsung) has not been availing of the entire outlay allocated for it," the person said.

"Samsung is filing claims based on what minimum production a company has to achieve to get the incentives," said the second person.

However, for the fifth year, the company is likely to have surpassed the production targets.

"The actual production done by the company will be known when it files the claims," the person added.

The government had earmarked a financial outlay of the scheme based on the maximum production or ceiling which the companies could achieve during the tenure of the scheme. For availing of benefits, a company has to achieve a minimum target, but incentives can be taken to a level of maximum production or ceiling.

The smartphone PLI scheme offers graded incentives in the form of cashbacks at 6% of incremental sales of goods for each of the first two years, 5% for the third and fourth years, and 4% for the fifth year.