Electronics and Pharma Sectors Receive 70% of PLI Scheme Payouts
Government data for FY25 reveals that the electronics and pharmaceutical sectors have cornered approximately 70% of the total fiscal incentives disbursed under the Production-Linked Incentive (PLI) schemes. Of the total Rs 10,114 crore disbursed, large-scale electronics manufacturing received Rs 5,732 crore and pharma received Rs 2,328 crore. The figures underscore the strategic focus and success of the government's flagship policy in boosting domestic manufacturing and exports in these key areas.
Unpacked:
PLI schemes are government initiatives launched in 2020 to provide financial incentives to manufacturers based on increased sales over a base year. They were introduced to boost domestic manufacturing, attract investment, reduce import dependency, enhance exports, and support India's goal of becoming self-reliant in key sectors like electronics, pharmaceuticals, and more.
The electronics sector has shifted from being a net importer to a net exporter of mobile phones, with significant increases in both production and foreign investment. The pharmaceutical sector has become the world’s third-largest by volume, with exports now accounting for 50% of production and much greater domestic manufacturing of key drugs and devices.
PLI covers 14 sectors, including textiles, automobiles, telecom, medical devices, food processing, and drones. Sectors like telecom have achieved 60% import substitution, and drones have seen a seven-fold increase in turnover. The schemes have driven increased production, exports, job creation, and substantial investment across these sectors.
As of late 2024, the PLI schemes have attracted around ₹1.61 lakh crore in investments and generated about ₹14 lakh crore in production/sales. They have created over 1.15 million (11.5 lakh) direct and indirect jobs, bolstering India’s manufacturing ecosystem and global competitiveness.