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Mobile device manufacturing allotted a huge share in PLI scheme in Budget
The Union Budget 2023-24 has earmarked Rs 8,083 crore for production-linked incentive (PLI) schemes, a substantial jump from the revised Budget estimates for these schemes in FY22-23, which is pegged at Rs 4,800 crore. The bulk of the money goes to large-scale electronics manufacturing, pharma, auto and auto components, and food processing.
Large-scale electronics manufacturing, including mobile devices have been allotted a huge share, Rs 4,499 crore. This is because five global (including three vendors of Apple Inc) and an equal number of homegrown mobile makers have committed to be eligible for incentives with a minimum incremental sales of Rs 50,000 crore in FY24 (double of FY23) upto a maximum ceiling of Rs 120,000 crore (compared to Rs 75,000 crore in FY 23).
Telecom has not received any fresh allocation. In FY23 an amount of Rs 90.25 crore was earmarked for PLIs in telecom products. The earlier scheme was revamped in June 2022 to promote the entire value chain of telecom production. Approvals for new players under the scheme were cleared in October last year.
One of the most anticipated announcements was the expansion of PLI scheme to newer sectors including renewable energy, toys, leather, and a few more. However, there was no mention of this in the FM’s Budget speech.
“The Union Budget speech from the indirect tax perspective was customs-centric, with an intention to boost exports, domestic manufacturing/ value addition,” says Abhishek Jain, partner, indirect tax, KPMG in India. “Specific announcements on further PLI schemes and customs amnesty scheme may have provided further cheer,” he adds.
The total allocation for the PLI schemes for the next three to five years is Rs 1.97 lakh crore. The government has already cleared the amount.
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