Connect with us

Company News

Samsung PLI scheme incentives overinvoicing issue remains unresolved

Samsung Electronics may have to do without sops for its first year of production-linked incentive (PLI) scheme in India citing government sources.

The Korean major may lose the initial incentives from the PLI scheme for smartphone manufacturing in India, It is due to some discrepancies in invoicing.

However, Samsung said that it is in advanced discussions with the Centre to resolve the issue.
In 2021, the electronics major had claimed a sum of Rs 900 crores as incentive for completing Rs 15,000 crore worth of additional sales than the previous year.

To secure these sops, Samsung had to make handsets with a factory cost of nearly Rs 15,000 crore. But the Ministry of Electronics and Information Technology (MeitY) withheld the payout due to some discrepancies raised in the company’s invoices, the reports said.

Quoting a senior government official said that the company had a few issues in the valuations of their invoices. But now their invoices are “very accurate” and are being verified.

However, despite this Samsung will lose out on the PLI scheme incentive for the first year.

The report further added that incentives for the second year (FY 2022) of the PLI scheme will start soon.

Samsung’s competitors like iPhone-makers Foxconn (Hon Hai) and Wistron, as well as homegrown companies such as Dixon Technologies, have already received their FY22 sops.

According to a Samsung spokesperson, the company is in an advanced stage of discussions with the Centre on the matter of incentive payout, the ET report said.

In August 202, India started the PLI scheme for mobile handsets, with an outlay of Rs 40,951 crore over five years.

The PLI scheme offers graded incentives that are worth 6 per cent of incremental sales of goods achieved over the base year for the initial two years.

In the third and fourth years, the companies get incentives worth 5 per cent. In the fifth year, these incentives will come down by 4 per cent.

However, the global companies need to invest a minimum of Rs 250 crore in the first fiscal, and similar amounts in the following three fiscal years, and produce incremental goods (mobile phones with invoice value of Rs 15,000 and above) worth Rs 4,000 crore, Rs 8,000 crore, Rs 15,000 crore, Rs 25,000 crore and finally Rs 50,000 crore in five successive years. Business Standard

Click to comment

You must be logged in to post a comment Login

Leave a Reply

Copyright © 2023 Communications Today

error: Content is protected !!