PLI Scheme for Telecom & Networking Products amended with additional incentive rates

The Guidelines for the Production linked incentive (PLI) Scheme for Telecom and Networking Products have been amended to introduce the Design-led Manufacturing with additional incentive rates. The PLI Scheme has been amended to facilitate Design-Led Manufacturing with an additional incentive rate of one per cent over and above existing incentive rates.

Communications Ministry said in a release that this was done after consultations with stakeholders.

The Union Budget 2022-23 has proposed to launch a Scheme for design-led manufacturing as part of the existing PLI Scheme to build a strong ecosystem for 5G. Additional telecom and networking products have been added to the list of eligible products.

The addition of 11 new telecom and networking products has also been approved to the existing list. For promoting design-led manufacturing, the Department of Telecommunications has invited applications from Design-led manufacturers as well as others, for availing incentives under the PLI Scheme for five years commencing from April 1, 2022.

The Scheme is open to both MSME and Non-MSME Companies including Domestic and Global Companies. The applications from Design-led manufacturers shall be prioritized over other manufacturers while shortlisting. The Design Led Manufacturing is primarily aimed to support efforts for designing telecom products in India. It will recognize and encourage R&D-driven manufacturing in the country to enhance its contribution to the global value chain as envisaged in the National Digital Communication Policy, 2018.

Applicants will have to satisfy the minimum Global Revenue criteria to be eligible under the Scheme. The Company may decide to invest in single or multiple eligible products. The Scheme stipulates a minimum investment threshold of Rs 10 crore for MSME and Rs 100 crore for non-MSME applicants. Land and building costs will not be counted as investments.

Eligibility shall be further subject to Incremental Sales of Manufactured Goods (covered under Scheme Target Segments) over the base year (FY2019-20). The allocation for MSME has been enhanced from Rs 1,000 crores to Rs 2,500 Crores.

Interested eligible Applicants can start the registration process for the Scheme from June 21, 2022, and the application window shall be open for 30 days i.e., up to July 20, 2022. These applications are invited for the balance fund of more than Rs 4,000 crore. This will give a boost to the manufacturing of telecom and networking products to develop a 5G ecosystem for India.

Department of Telecommunications (DoT) notified the Production Linked Incentive (PLI) Scheme on February 24, 2021, with a financial outlay of Rs 12,195 Crores. A total of 31 companies, comprising 16 MSMEs and 15 Non-MSMEs including 8 Domestic and 7 Global companies were approved on October 14, 2021.