Extending PLI scheme for tyres, steel to help link India to global value chains: PHDCCI President

Extending the benefits of production-linked incentive (PLI) scheme to sectors like tyres and steel will further help in linking India to the global value chains and will give companies a competitive edge in the world market, newly appointed President of industry chamber PHDCCI Pradeep Multani said on Thursday.

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Under the PLI scheme, the government is providing incentives to 13 sectors at present. It includes textiles, automobiles, white goods, pharmaceuticals, specialty steel, telecom, food products, high efficiency solar PV modules, and advanced chemistry cell (ACC) batteries.

He said that the PLI scheme will incentivize large domestic and global players to boost production, build a competitive ecosystem and would lead to a more inclusive growth.

It will also provide a huge impetus to global companies looking for options to set up facilities beyond China.

"Extending sectors like tyres and steel under the ambit of PLI scheme would further help link India to global value chains, encourage exports, give companies a competitive edge in the global market and make India a global manufacturing hub in the coming times," Multani told PTI.

He is also the Chairman of Multani Pharmaceuticals.

Talking about India's economic growth, he said that the GDP (Gross Domestic Product) growth rate of around 10.25 per cent in 2021-22 and around 9-10 per cent for 2022-23 is expected.

The improvement in key economic indicators is signalling broad-based recovery in the coming months which will be higher than the pre-COVID economic activity, he said.

"Lead economic and business indicators such as steel, merchandise exports, external commercial borrowings and Sensex have shown a noteworthy improvement in recent months due to significant pick-up in the economic activity and accelerated vaccination drive in many parts of the country," he added.

The Indian economy grew by a record 20.1 per cent in the April-June quarter, helped by a very weak base of last year and a sharp rebound in the manufacturing and services sectors in spite of a devastating second wave of COVID-19 cases.

When asked about foreign direct investment (FDI) in the coming months, Multani said India has attracted FDI worth USD 81.4 billion in the last fiscal due to trust, opportunity and amicable business environment provided by the country.

"Entire FDI pockets are getting widened in India as states are taking effective initiative for ease of doing business. International investors remain confident of India's growth prospects in the coming months due to political and economic stability," he said.

He added that further streamlining institutional stability such as regulatory clarity and efficient judicial redress and mechanisms, would further support the growth of FDI in India.

He also suggested that the government should take initiatives to smoothen Indian laws and bureaucracy, bring investor-friendly land reforms, up-grade infrastructure, reduce logistics cost along with providing incentives for the foreign companies to relocate in India.

"This would further improve ease of doing business," Multani said.