Just 1/5th of auto PLI firms have products cleared for incentives

More than two years after its launch, only 16 of the 84 firms eligible under the ₹25,938 crore production-linked incentive (PLI) scheme for automobiles and auto components have products that have met the required domestic value addition (DVA) criteria to qualify for incentives.

- SURAJEET DAS GUPTA

These companies have received clearance for 107 model and component variants, having met the DVA threshold, based on data available till July 31. However, with China tightening restrictions on exports of critical rare earth materials, which is crucial for manufacturing electric motors in India, achieving the 50 per cent localisation target is likely to become even more challenging. This has prompted the auto industry to urge the government to exclude electric motors from the DVA calculation.

The scheme, which was launched initially from April 1, 2022, to March 2027, was extended for a year to 2028 (started from April 1, 2023). However, the first OEM model to be approved under the scheme for achieving the required 50 per cent DVA threshold was only cleared on August 17, 2023.