January 18, 2023
In the last budget, INR 1.97 lakh crore was allocated for PLI schemes
Allocations for sectors that have been successful under the schemes, such as electronic manufacturing and IT hardware, could be increased
The budget may also extend the lower corporate tax rate of 15% for new manufacturing investments for a few more years
The government is also considering measures to encourage private investment
India is expected to increase the allocation for its Production-Linked Incentive (PLI) schemes in the upcoming budget on February 1st, according to sources familiar with the matter. The PLI schemes, which aim to reignite manufacturing in India and increase exports, have shown positive results and may be expanded to include new sectors. Additionally, allocations for sectors that have already seen success under the PLI schemes, such as electronic manufacturing and IT hardware, could be increased.
In the last budget, Finance Minister Nirmala Sitharaman allocated INR 1.97 lakh crore for PLI schemes that currently cover 14 key sectors. This amount, which is for five years beginning in FY22, may be raised in the upcoming budget.
As India looks to attract global manufacturers looking to diversify their supply chains, the budget may also extend the lower corporate tax rate of 15% for new manufacturing investments for a few more years. The government is also considering measures to encourage private investment, such as expanding PLI schemes and easing compliance requirements in various areas. Experts suggest that the government should build upon the success of the PLI program to attract more investment and boost the economy.
Source: Economic Times