'PLI Scheme has potential to position India in Global Value Chain'

New Delhi, June 3 Budget allocation of $20 billion to 13 core sectors of the economy, under the PLI scheme will encourage incentive-led manufacturing base and has the potential to position India in global value chain, a senior government official said on Thursday.

Additional Secretary, Department for Promotion of Industry and Internal Trade (DPIIT), Sumita Dawra, in her remarks in a virtual open house session on the Implications of PLI Scheme on India's Manufacturing and Trade Competitiveness, organised by the PHD Chamber of Commerce and Industry, stated that the PLI scheme can boost R&D, economies of scale, meeting quality standard and therefore, has the potential to create global champions in manufacturing.

She stated that the PLI scheme for electronics 2020 notified mobile specific electronic components, produced goods worth Rs 54,000 crore and investments worth Rs 2,300 crore between August 2020 and March 2021.

Dawra also said that in the pharma sector, bulk drugs have received Rs 5,400 crore, medical devices Rs 870 crore and 3rd PLI for Pharma has received Rs 15,000 crors in investments; the food processing sector has received Rs 34,000 crore in investments and therefore, observed that the PLI scheme is already generating transformation and is expected to generate further benefits over the period of the next five years.

Former Commerce Secretary Ajay Dua said that the eligible beneficiary of the scheme should be decided by the expert committee of industry members and there should be legally enforceable contract to gain the confidence of investors and increase the accountability of PLI beneficiary stakeholders.

Food Processing Industries Ministry's Economic Adviser Kuntal Sensarma mentioned that "Production Linked Incentive Scheme for Food Processing Industry (PLISFPI)" for implementation during 2021-22 to 2026-27 with an outlay of Rs 10,900 crore will boost domestic manufacturing and attract large investment in food processing industries.

The objective of the scheme is to support creation of global food manufacturing champions, support Indian brands of value added food products in the international markets, increase employment opportunities for off-farm jobs, and ensure remunerative prices of farm produce and higher income to farmers.

Noting that the PLI aims to make Indian brands globally accepted, he mentioned that of the 13 sectors under the PLI scheme, food processing and pharmaceuticals have ample scope for growth and expansion and also noted that the processing level is low, especially in fruits and vegetables.

Textiles Ministry Trade Adviser Jay Karan Singh said that the PLI scheme for the textile sector has been conceived as "focus product intensive scheme" and will offer a 5-year gestation period for manufacturing. He said that for greenfield investments of minimum Rs 300 crore and turnover of Rs 600 crore in first year, with 25 percent incremental turnover in next three to four years, will be given an incentive of 15 per cent in production.

PHD Chamber's Industry Affairs Committee Chairman Sandeep Aggarwal, in his welcome remarks, stated that earlier Japan and the US were the largest producers of optical fibre, but now China produces more than 50 per cent because of various interventions undertaken by the government. Therefore, government support in investment and technology is crucial for boosting manufacturing, he said.