PLI Scheme for Automobiles is Driving Investment, Employment, and Growth

28 Mar 2025 CW Team

Industry-Oriented Implementation The PLI-Auto Scheme has remained adaptable to industry needs, with stakeholder consultations shaping its guidelines. On 9th November 2021, the Ministry of Heavy Industries (MHI) notified 19 AAT vehicle categories and 103 AAT components eligible for incentives.

To strengthen the Make in India initiative, applicants must achieve 50% Domestic Value Addition (DVA) to qualify for incentives—ensuring reduced imports and a robust domestic & global supply chain. A Standard Operating Procedure (SOP) has been devised through collaborative efforts of testing agencies, standardizing the DVA calculation process.

Milestones Achieved

6 OEMs have received DVA certificates for 66 approved variants. 7 Component Manufacturers have secured DVA certificates for 22 approved variants.

As of December 2024, companies under the scheme have committed Rs 250 billion towards new production facilities and technological upgrades. Tata Motors and Mahindra & Mahindra have significantly expanded EV production capacity.

Thousands of direct and indirect jobs have been generated across manufacturing, supply chain management, and R&D. Localized employment opportunities have surged in EV production hubs. Significant increase in sales of EVs and critical components, driven by the introduction of new models.

FY 2023-24 was the first performance year, with Rs 3.22 billion disbursed in FY 2024-25 under the scheme.

Conclusion The PLI-Auto Scheme has emerged as a catalyst for India’s automotive sector, promoting advanced manufacturing, job creation, and market expansion. By encouraging technological innovation and domestic production, it is positioning India as a global leader in the auto industry.

The Production Linked Incentive (PLI) Scheme for Automobile & Auto Components, approved by the Union Cabinet on 15th September 2021, has been instrumental in boosting domestic manufacturing and overcoming cost disabilities in the industry. With a budgetary outlay of Rs 259.38 billion, the scheme aims to enhance indigenous production of Advanced Automotive Technology (AAT) products and generate employment. Industry-Oriented Implementation The PLI-Auto Scheme has remained adaptable to industry needs, with stakeholder consultations shaping its guidelines. On 9th November 2021, the Ministry of Heavy Industries (MHI) notified 19 AAT vehicle categories and 103 AAT components eligible for incentives. To strengthen the Make in India initiative, applicants must achieve 50% Domestic Value Addition (DVA) to qualify for incentives—ensuring reduced imports and a robust domestic & global supply chain. A Standard Operating Procedure (SOP) has been devised through collaborative efforts of testing agencies, standardizing the DVA calculation process. Milestones Achieved 6 OEMs have received DVA certificates for 66 approved variants. 7 Component Manufacturers have secured DVA certificates for 22 approved variants. As of December 2024, companies under the scheme have committed Rs 250 billion towards new production facilities and technological upgrades. Tata Motors and Mahindra & Mahindra have significantly expanded EV production capacity. Thousands of direct and indirect jobs have been generated across manufacturing, supply chain management, and R&D. Localized employment opportunities have surged in EV production hubs. Significant increase in sales of EVs and critical components, driven by the introduction of new models. FY 2023-24 was the first performance year, with Rs 3.22 billion disbursed in FY 2024-25 under the scheme. Conclusion The PLI-Auto Scheme has emerged as a catalyst for India’s automotive sector, promoting advanced manufacturing, job creation, and market expansion. By encouraging technological innovation and domestic production, it is positioning India as a global leader in the auto industry.

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