Government releases SOPs under PLI scheme for automobile sector

The Indian government has unveiled the standard operating procedures (SOPs) for the PLI scheme for the automobile sector. Under this scheme, companies can apply for testing and certification of advanced automotive technology products to qualify for incentives.

Minister of Heavy Industries Mahendra Nath Pandey said his ministry is trying to align itself with the Prime Minister’s vision of Aatmanirbhar Bharat, and these SOPs (standard operating procedures) will not only help achieve that but will also help in increasing the manufacturing foothold.

With this, the ministry aims to boost the domestic manufacturing sector and reduce dependence on imports, thereby creating more job opportunities for Indians. Pandey also added that it would contribute to the overall economic growth of the nation. The scheme is expected to attract significant investments and help India become a global hub for automobile manufacturing, an official statement said.

The Ministry of Heavy Industries notified the Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India (PLI-AUTO Scheme) on September 23, 2021, with a budgetary outlay of Rs 25,938 crore.

The PLI-Auto Scheme proposes financial incentives to boost domestic manufacturing of advanced automotive technology (AAT) products and attract investments in the automotive manufacturing value chain. The scheme has two parts: Champion OEM, which will make electric or hydrogen-powered vehicles, and Component Champions, which will make high-value and high-tech components.

On November 9, 2021, the heavy industries ministry notified the categories of 19 AAT vehicles and 103 AAT components that shall be covered under the scheme, which either do not have an existing supply chain in India or use advanced technology. The scheme is expected to increase India’s presence in the global automotive and advanced technology supply chains.