Government announces over 12,000 crore production push for telecom equipment


On Wednesday, the government approved a ~12,195 crore production-linked incentive (PLI) scheme for the production of telecom gear in India that is supposed to facilitate the production of equipment worth ⁇ 2.44 lakh crore and generate direct and indirect jobs for around 40,000 people, Union Minister Ravi Shankar Prasad said.

The PLI scheme will be operational from 1 April 2021 for the manufacture of telecommunications gear.

In the coming 5 years, they hope to have an incremental output of ₹2,44,200 crore, exports worth ₹1,95,360 crore, direct and indirect jobs to 40,000 people, and tax revenue of roughly ₹17,000 crores to the country, informed Minister of Telecommunications Ravi Shankar Prasad after the Cabinet meeting.

As per the official announcement, the policy is supposed to carry over 3,000 crore investments and create major direct and indirect jobs and taxes.

Bringing up to media after the Cabinet meeting, Prasad said that the government is placing India as a global manufacturing engine and building a favorable atmosphere for ease of business.

“Cabinet has authorized PLI for the telecommunications sector … to ensure the further success of Make-in-India in the field of telecommunications equipment … 5G equipment will also arrive… so it was necessary to have incentives”

Prasad added that the scheme also seeks to foster small and medium-sized enterprises in ‘Aatmanirbhar Bharat.’

The scheme is intended to offset big imports of more than 50,000 crores worth of telecom equipment and improve it with “Made in India” goods for both domestic industries and exports, the report said.

The new system seems to have an expense of approximately 12,195 crores over five years and would be subject to a minimum requirement of gross incremental expenditure and incremental sales of produced products for its eligibility.

The reward system varies between 4% and 7% for various groups and years. The release added that the financial year 2019-20 will be viewed as the base year for estimating the total incremental sales of manufactured goods net of taxes.

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