The Department of Telecommunications (DoT) yesterday amended the guidelines for the PLI scheme for Telecom & Networking Products to introduce design-led manufacturing with additional incentive rates. The move is in line with the objective to build a strong ecosystem for 5G and the Union Budget 2022-23 proposal to launch a scheme for design-led manufacturing as part of the existing PLI scheme.
The Telecom Department has invited applications from design-led manufacturers as well as others for availing incentives under the PLI scheme for five years commencing from 1st April 2022. The investments made by successful applicants in India from 1st April 2022 onwards and up to Financial Year (FY) 2025-26 shall be eligible, subject to qualifying incremental annual thresholds.
The scheme is open to both MSME and non-MSME companies including domestic and global companies. The applications from design-led manufacturers will be prioritized over other manufacturers during shortlisting.
The design-led manufacturing is primarily aimed to support efforts for designing telecom products in India. This will recognize and encourage R&D-driven manufacturing in the country to enhance its contribution to the global value chain as envisaged in the National Digital Communication Policy 2018.
The applicants will have to satisfy the minimum global revenue criteria to be eligible under the scheme. The company can decide to invest in single or multiple eligible products. The PLI scheme mandates a minimum investment threshold of Rs 10 crores for MSME and Rs 100 crores for non-MSME applicants. The land and building costs will not be counted as investments.
The eligibility shall be further subject to incremental sales of manufactured goods covered under the scheme target segments over to the base year FY 2019-20. The allocation for MSME has been enhanced from Rs 1000 crores to Rs 2500 crores. The interested eligible applicants can start the registration process for the scheme on 21st June 2022. The window for the applications will be open for 30 days till 20th July 2022.
The applications have been invited for the balance fund of more than Rs 4000 crores. The amended PLI scheme is likely to give a boost to the manufacturing of telecom and network products to develop a 5G ecosystem for India.
The Department has also decided to extend the existing PLI scheme by one year. The existing PLI beneficiaries will be given an option to choose the financial year 2021-22 or financial year 2022-23 as the first year of incentive.