India boosts production-linked incentive scheme for telecoms

India boosts production-linked incentive scheme for telecoms

There’s good news for telecommunications companies in, or serving, India with the announcement by the Department of Telecommunications of additions to the area of the production-linked incentive (PLI) scheme relevant to telecoms and networking.

PLI is an initiative that aims to attract large investments from global players and help domestic companies seize emerging opportunities to become players in the export market. 

The DoT has not only extended the PLI scheme for telecom networking products by one year but has also raised the incentive rate by an additional 1% and added another 11 items to the list of products that can be manufactured under the scheme.

In addition the existing PLI scheme has been amended. It now includes design-led manufacturing.

According to India’s Economic Times applications for this additional area are now being invited. It is open for both medium and small-scale enterprises (MSMEs) and non-MSMEs, including domestic and global companies. There is, however, a fairly significant minimum investment required for the design-led manufacturing scheme: about Rs 10 crores or US$1.3 million for MSMEs and Rs 100 crores or US$12.8 million crores for non-MSMEs, excluding land and building costs.

The incentives will be based on incremental sales of manufactured goods. MSMEs will get an additional 1% incentive in the first, second and third years.

According to figures from investment promotion agency Invest India, India is the second-largest telecoms market in the world with 765.1 million broadband subscribers. It provides direct and indirect employment to four million people in India and constitutes 7% of all FDI inflows in the country.

PLI for telecom and networking products aims to attract large-scale investments in telecom equipment manufacturing and augment domestic production capacity.


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