Centre to Allow $23 Billion Incentives Scheme to Lapse

Central government has decided to let lapse a $23 billion program to incentivize domestic manufacturing, just four years after it launched the effort to woo firms away from China, according to four government officials.

- Reuters

NEW DELHI:

The scheme will not be expanded beyond the 14 pilot sectors and production deadlines will not be extended despite requests from some participating firms, two of the officials said.

Some 750 companies, including Apple supplier Foxconn and Indian conglomerate Reliance Industries, signed up to the Production-Linked Initiative scheme, public records show.

Firms were promised cash payouts if they met individual production targets and deadlines. The hope was to raise the share of manufacturing in the economy to 25% by 2025.

Instead, many firms that participated in the program failed to kickstart production, while others that met manufacturing targets found India slow to pay out subsidies, according to government documents and correspondence seen by Reuters.