The Production-Linked Incentive scheme

The Union Cabinet on Wednesday approved changes in the production-linked incentive (PLI) scheme for the manufacturing of semiconductors.

The Government had recently announced an outlay of Rs 76,000 crore (around $10 billion), under its PLI scheme, separately for developing a semiconductor and display manufacturing electronics ecosystem.

Allow for uniform fiscal support of 50 per cent of project cost for semiconductor fabs across technology nodes and display manufacturing.

It also raised the fiscal support for compound semiconductors, packaging and other semiconductor facilities to 50 percent from 30 percent earlier.

It is a material product usually composed of silicon, which conducts electricity more than an insulator, such as glass, but less than a pure conductor, such as copper or aluminium.
They are the basic building blocks that serve as the heart and brain of all modern electronics and information and communications technology products.

4th Industrial revolution:
- The Fourth Industrial Revolution, 4IR, or Industry 4.0, conceptualises rapid change to technology, industries, and societal patterns and processes in the 21st century due to increasing interconnectivity and intelligent automation.
- Semiconductor chips are the lifeblood of the modern information age. They enable electronic products to compute and control actions that simplify our lives.
Critical infrastructures:
- Semiconductors are used in critical infrastructures such as communication, power transmission, etc., that have implications for national security.
The deeper integration to the global value chain:
- Development of the semiconductor and display ecosystem will have a multiplier effect across different sectors of the economy with deeper integration to the global value chain.
High consumption:
- India’s semiconductor consumption is expected to exceed $80 billion by 2026 and reach $110 billion by 2030.

About :
- The Government of India launched the Production-Linked Incentive(PLI) in March 2020. The scheme initially targeted three industries:
  - Mobile and allied Component Manufacturing
  - Electrical Component Manufacturing
  - Medical Devices
Aims:
- PLI scheme is a scheme that aims to give companies incentives for incremental sales from products manufactured in domestic units.
- The initiative encourages international companies to establish units in India. Still, it also attempts to encourage Indian companies to establish or expand existing manufacturing facilities, creating more jobs and reducing the country’s dependency on imports from other nations.
Implementation:
- Relevant ministries and departments implement the Scheme.
- 14 sectors participate big in the government’s PLI schemes. PLI scheme draws huge investments. Incentives For Make In India.

Pic Courtesy: India Briefing

Content Source: Economic Times