Production-linked Incentive scheme for ACs & LED lights gets 38 applications

As many as 38 companies have applied for the central government's Production-linked Incentive scheme (PLI) for air conditioners and LED lights, launched by the Department for Promotion of Industry and Internal Trade (DPIIT), with investment commitments amounting to Rs 4,121 crore, the Ministry of Commerce & Industry said on Monday. The applications were submitted in a 90-day application window that closed on October 12. This was the third such online application window for the incentive scheme.

Here are 10 things to know about this development:

• Forty three per cent of the applicants belonged to the MSME sector, reflecting the segment's confidence to participate in the value chains of AC and LED light components.
• Out of the 38 applicants, eight were the existing beneficiaries of the government's Production-linked Incentive scheme for white goods (PLIWG) committing net incremental investments to the tune of Rs 1,285 crore.
• The other 30 new applicants have committed investments amounting to Rs 2,836 crore. These applicants propose to make various types of critical parts for ACs and LED lights.
• Applicants participating in the third round have lined up investments spanning 13 states including Jammu & Kashmir and Odisha and 49 new locations.
• As part of the scheme, various manufacturing clusters are emerging at different locations. These are:
  • Noida-Greater Noida in Uttar Pradesh
  • Neemrana and Bhiwari in Rajasthan
  • Aurangabad-Pune in Maharashtra
  • Sanad in Gujarat
  • Sri City in Andhra Pradesh
• The scheme has a healthy mix of multinational and domestic companies, with five additional foreign companies committing to invest Rs 245 crore.
• Overall, the scheme is expected to bring in investment to the tune of Rs 11,083 crore in the component manufacturing ecosystem of the two white goods categories, generating direct employment for 80,486 people, according to the official statement.
• The scheme is estimated to lead to the total production of AC and LED components worth about Rs 1,81,975 crore.
• Several applicants in the third round are vendors for large manufacturers such as Daikin, Voltas, Blue Star and LG Electronics in the ACs sector, and for makers such as Surya, Orient, Crompton Greaves, Signify and Halonix in LED lights.
• The Union Cabinet cleared the PLI scheme for the two segments in April 2021 with an outlay of Rs 6,238 crore.