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Samsung spars with India over $110 million production incentives

Samsung Electronics Co. is struggling to collect manufacturing incentives it considers it’s owed by India, highlighting the sometimes complicated nature of such government programs.

The smartphone giant’s India unit is seeking just under Rs 900 crore ($110 million) in incentives for the fiscal year through March 2021, people familiar with the matter said. But the government is only willing to give the South Korean firm 1.65 billion rupees unless it can provide more information and documents to support its claim, the people said, asking not to be identified as the matter isn’t public.

The incentives are a key component in Prime Minister Narendra Modi’s drive to make India an electronics manufacturing hub. The country in 2020 announced $6.7 billion in production-linked incentives (PLIs), promising cash to companies on sales of locally made smartphones. That plan has encouraged Samsung to build devices worth billions of dollars in the country, making it the largest exporter of smartphones from the South Asian nation in the latest fiscal year.

Samsung is in discussions with the government on the incentive payout, a company spokesman said via email, adding that the phone maker is working with various stakeholders to make the PLI program successful.

Samsung Electronics Co. is struggling to collect manufacturing incentives it considers it’s owed by India, highlighting the sometimes complicated nature of such government programs.

The smartphone giant’s India unit is seeking just under Rs 900 crore ($110 million) in incentives for the fiscal year through March 2021, people familiar with the matter said. But the government is only willing to give the South Korean firm 1.65 billion rupees unless it can provide more information and documents to support its claim, the people said, asking not to be identified as the matter isn’t public.

The incentives are a key component in Prime Minister Narendra Modi’s drive to make India an electronics manufacturing hub. The country in 2020 announced $6.7 billion in production-linked incentives (PLIs), promising cash to companies on sales of locally made smartphones. That plan has encouraged Samsung to build devices worth billions of dollars in the country, making it the largest exporter of smartphones from the South Asian nation in the latest fiscal year.

Samsung is in discussions with the government on the incentive payout, a company spokesman said via email, adding that the phone maker is working with various stakeholders to make the PLI program successful. Bloomberg

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