In the current fiscal, the Department of Telecommunications (DoT) is likely to pay incentives of over Rs 400 crore to 20 companies, including Nokia, Jabil, VVDN and HFCL, which have met the Production Linked Incentive (PLI) production targets of telecommunications equipment.
"Incentives will be given in FY22-23 to achieve the targets, and 20 companies have been selected accordingly," a DoT official told ET.
Another official said that although this is the second year of the scheme, many companies are getting benefits for the first time as they have opted to participate in the revised scheme and have also increased investment.
Initially, DoT announced a PLI scheme for telecom companies and network products at a cost of Rs 12,195 crore in February 2021. A total of 31 companies were admitted into the system on October 14, 2021.
The system offers discounts of 4% to 7% across different classes and years. SMEs are offered a 1% higher discount in years 1, 2 and 3. The system was changed in April last year to facilitate design-based manufacturing by adding an additional 1% discount to the current discounts. 4,000 million out of 12,195 million were earmarked for this purpose.
The scheme was extended by a year as most of the selected companies were unable to meet production targets due to supply chain disruptions related to COVID-19. In the revised plan, 42 companies, of which 28 were small and medium enterprises (SMEs), were selected to make a total investment of Rs 4,115 crore. Current firms covered by the PLI system were allowed to add and apply for products under the design-based PLI system.
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