The Union Cabinet of India on Wednesday approved the Production Linked Incentive Scheme for the automobile and drone Industry with a budgetary outlay of ₹ 26,058 crore. The PLI scheme for the auto sector will incentivize high value Advanced Automotive Technology vehicles and products.
PLI Scheme for Automobile Industry and Drone Industry is part of the overall announcement of PLI Schemes for 13 sectors made earlier during the Union Budget 2021-22, with an outlay of ₹ 1.97 lakh crore. With the announcement of PLI Schemes for 13 sectors, minimum additional production in India is expected to be around ₹ 37.5 lakh crore over 5 years and minimum expected additional employment over 5 years is nearly 1 crore.
The PLI Scheme for the auto sector envisages to overcome the cost disabilities to the industry for manufacture of Advanced Automotive Technology products in India. The incentive structure will encourage industry to make fresh investments for indigenous global supply chain of Advanced Automotive Technology products.
This PLI Scheme for automotive sector along with the already launched PLI scheme for Advanced Chemistry Cell (ACC) (₹18,100 crore) and Faster Adaption of Manufacturing of Electric Vehicles (FAME) (₹10,000 crore) “will enable India to leapfrog from traditional fossil fuel based automobile transportation system to environmentally cleaner, sustainable, advanced and more efficient Electric Vehicles (EV) based system,” the statement mentioned.
“The PLI for Drones and Drone components industry, will over a period of three years, lead to investments worth ₹ 5,000 Crore, increase in eligible sales of ₹ 1500 crore and create additional employment of about 10,000 jobs,” the statement further added. The PLI Scheme for the Drones and Drone components industry “addresses the strategic, tactical and operational uses of this revolutionary technology.” A product specific PLI scheme for drones with clear revenue targets and focus on domestic value addition is key to building capacity and making these key drivers of India’s growth strategy.
“Drone sales and popularity have continued to increase in India with the support of the liberalised rules. Application of drones will soon cuts across various sectors construction, delivery, law enforcement, media and entertainment, precision agriculture, surveying and mapping, and inspection and monitoring. The PLI scheme along with the liberalised drone rules, 2021 issued by the government on 25th August 2021 will help realise this growth potential,” Swapnik Jakkampudi, Co-Founder, Skye Air Mobility said.
“Given the demand and under the favourable climate, India has the potential of becoming a global drone hub by 2030. The PLI scheme comes as a follow-through of the liberalised Drone Rules, 2021 released by the Central Government on 25 August 2021. The PLI scheme and new drone rules are intended to catalyse supernormal growth in the upcoming drone sector,” said Ankit Kumar ,Founder Alternative Global India.
“And now the industry will boast of big numbers. Thanks to the new rules and the incentive scheme, the drones and drone components manufacturing industry may see an investment of over INR 5,000 crore over the next three years. The annual sales turnover of the drone manufacturing industry may grow from INR 60 crore in 2020-21 fold to over INR 900 crore in FY 2023-24. The drone manufacturing industry is expected to generate over 10,000 direct jobs over the next three years. The drone services industry (operations, logistics, data processing, traffic management etc.) is far bigger in scale. It is expected to grow to over INR 30,000 crore in next three years. The drone services industry is expected to generate over five lakh jobs in three years.”