PLI in auto: Investment target of Rs 42,500 crore in sight

NEW DELHI: Production-linked incentive (PLI) scheme for the automobile sector is on track to exceed its investment target of Rs 42,500 crore, with manufacturers already committing over Rs 35,000 crore, a senior govt official said Wednesday. Of the 82 applicants for the scheme, comprising auto manufacturers and component makers, 72 have already committed investments with 18 of them making the cut in terms of the required investment and domestic value addition norms. Under the PLI auto scheme, incentives are linked to achieving at least 50% domestic value addition (DVA). "Next year we expect 5 to 10 more companies will join this list, so production volumes will increase even more," said the official. For 10 applicants, which have so far failed to invest, govt may look to invoke their bank guarantee. "This year is a success for PLI auto. In two out of five years since this scheme started, a large chunk has already been invested. From the investment criteria, the scheme is very successful. The biggest beneficiaries have been MSMEs," the official said. The scheme had spent 98% of its budget for the year, with Rs 2,000 crore given from Rs 2,091 crore budget to firms such as Tata Motors, Bajaj Auto, Mahindra & Mahindra, TVS Motor, Toyota and Ola Electric. The scheme saw the highest domestic value addition in four-wheelers, with around 80,000 electric cars qualifying since 2023.