The Indian government has approved the applications of 20 vehicle companies under the 'Champion OEM Incentive' scheme of the Production Linked Incentive (PLI) Scheme for the Automobile and Auto Component Industry. This is a positive development for the Indian auto industry, as it is expected to boost investment, create jobs, and promote the development of new technologies.
The 20 vehicle companies that have received approval under the PLI Scheme are:
- Ashok Leyland
- Eicher Motors
- Ford India
- Hyundai Motor India
- Kia India
- Mahindra & Mahindra
- Maruti Suzuki India
- MG Motor India
- Ola Electric
- PCA Automobiles
- Pinnacle Mobility Solutions
- Suzuki Motor Gujarat
- Tata Motors
- Axis Clean Mobility
- Booma Innovative Transport Solutions
- Elest
- Hop Electric Manufacturing
- Powerhaul Vehicle
- Hero MotoCorp
- Bajaj Auto
- TVS Motor Company
- Bosch
- Lucas-TVS
The PLI Scheme for the Automobile and Auto Component Industry was launched by the Indian government in April 2021 with the aim of attracting investment, creating jobs, and promoting the development of new technologies in the Indian auto industry. The scheme offers incentives to vehicle and auto component manufacturers who meet certain targets in terms of production and investment.
The 'Champion OEM Incentive' scheme is a part of the PLI Scheme for the Automobile and Auto Component Industry. The scheme offers incentives to vehicle manufacturers who invest in the production of advanced automotive technology (AAT) products in India.
The approval of the applications of 20 vehicle companies under the 'Champion OEM Incentive' scheme is a positive development for the Indian auto industry. The scheme is expected to boost investment, create jobs, and promote the development of new technologies in the Indian auto industry.
Benefits of the PLI Scheme for the Indian auto industry
The PLI Scheme is expected to have a number of benefits for the Indian auto industry, including:
- Increased investment: The PLI Scheme is expected to attract significant investment in the Indian auto industry. This is because the scheme provides financial incentives to vehicle and auto component manufacturers who invest in the production of advanced automotive technology (AAT) products in India.
- Job creation: The PLI Scheme is expected to create a large number of jobs in the Indian auto industry. This is because the scheme will lead to the setting up of new manufacturing facilities and the expansion of existing facilities.
- Reduced reliance on imports: India is currently dependent on imports for a number of AAT products. The PLI Scheme will help to reduce India's reliance on imports by promoting the domestic production of AAT products.
- Boost to the Indian economy: The PLI Scheme is expected to boost the Indian economy by attracting investment, creating jobs, and reducing imports.
Challenges
While the PLI Scheme has a number of benefits, it also faces a number of challenges, including:
- Lack of raw materials: India is currently dependent on imports for a number of raw materials used in the auto industry, such as steel and aluminum. This makes it difficult for Indian companies to compete with global auto manufacturers.
- Lack of skilled workforce: India also faces a shortage of skilled workers in the auto industry. This is because the auto industry is a highly technical industry.
- High cost of capital: The cost of capital is relatively high in India, which makes it difficult for Indian companies to raise the funds required to set up new manufacturing facilities and expand existing facilities.
Conclusion
The approval of the applications of 20 vehicle companies under the 'Champion OEM Incentive' scheme is a positive development for the Indian auto industry. The scheme is expected to boost investment, create jobs, and promote the development of new technologies in the Indian auto industry.
However, the PLI Scheme also faces a number of challenges, such as the lack of raw materials, the lack of a skilled workforce, and the high cost of capital. The government and industry will need to work together to address these challenges in order to ensure the success of the PLI Scheme and the Indian auto industry.
Additional thoughts on the PLI Scheme and its impact on the Indian auto industry
The PLI Scheme is a part of the Indian government's larger efforts to promote the manufacturing sector in India. The government has also introduced a number of other initiatives, such as the Make in India program and the National Manufacturing Policy, to support the manufacturing sector.
