Production Linked Incentive Scheme for Automobile and Auto Component Industry

Production Linked Incentive Scheme for Automobile and Auto Component Industry provides you with financial incentives for manufacturing Advanced Automotive Technology products. The PLI auto scheme extends for five years. Check if you qualify for the PLI scheme for automobile benefits.

The Production Linked Incentive (PLI) Scheme offers financial support to increase domestic manufacturing of Advanced Automotive Technology (AAT) products. It aims to remove cost disadvantages, create economies of scale, and build strong supply chains in India. The scheme encourages you to invest in new capacities and advanced technologies to support India’s shift to clean mobility and strengthen its role in the global automotive market.

The scheme focuses on improving India’s manufacturing strength and global competitiveness by:

• Removing cost disadvantages in AAT manufacturing.

• Creating economies of scale for a strong supply chain of AAT products.

• Generating employment across the automotive sector.

• Helping the industry add higher value to its products.

• Increasing exports of automotive goods from India.

The scheme has two parts covering vehicles and components:

• Champion OEM Incentive Scheme: Targets vehicle manufacturers (OEMs). Covers Battery Electric Vehicles (BEVs) and Hydrogen Fuel Cell Vehicles (HFCVs) of all types, including 2-wheelers, passenger cars, and commercial vehicles.

• Component Champion Incentive Scheme: Targets auto-component manufacturers. Applies to approved AAT components, CKD/SKD kits, and vehicle aggregates across various vehicle segments.

Incentives for manufacturers of Electric and Hydrogen Fuel Cell Vehicles.

• Applicable to Battery Electric Vehicles and Hydrogen Fuel Cell Vehicles of all segments.

• Covers 2-wheelers, 3-wheelers, passenger vehicles, commercial vehicles, and tractors.

• Incentivises sales of automobiles meant for military use.

• Requires you to meet the Minimum New Domestic Investment conditions.

Incentives for manufacturers of Advanced Automotive Technology components.

• Applicable to pre-approved Advanced Automotive Technology components of all vehicles.

• Covers components for 2-wheelers, 3-wheelers, passenger vehicles, and commercial vehicles.

• Includes incentives for CKD/SKD kits and vehicle aggregates.

• Requires you to meet the specific investment and revenue thresholds.

Focus on Advanced Automotive Technology (AAT) products.

• Battery Electric Vehicles (BEVs) with advanced battery technology.

• Hydrogen Fuel Cell Vehicles (HFCVs).

• Approved Advanced Automotive Technology components.

• Components for BEVs and HFCVs.

• Safety, emission control, and comfort-related systems.

Financial incentives to support your manufacturing growth.

• Incentives range from 8% to 18% of your product sales value.

• Additional 5% incentive for BEV and HFCV components.

• The total budget is ₹25,938 crores over five years.

• Improves your cost competitiveness.

Requirements for existing companies and new investors.

Existing Automotive Companies:

• Champion OEM: Global Group Revenue of minimum ₹10,000 crores and Global Investment in fixed assets of ₹3,000 crores.

• Component Champion: Global Group Revenue of minimum ₹500 crores and Global Investment in fixed assets of ₹150 crores.

New Non-Automotive Investors:

• Global Net Worth: Minimum ₹1,000 crores based on audited financial statements.

• Committed Investment: Must meet the "Minimum New Domestic Investment Conditions" within five years.

• Business Plan: Present a clear plan to generate revenue from AAT vehicles or components.

Key operational guidelines for scheme compliance.

• Note 1: You must achieve a minimum 10% Year-on-Year growth in Determined Sales Value.

• Note 2: The scheme requires a minimum 50% Domestic Value Addition (DVA) for eligibility.

• Note 3: Incentives apply only to the determined sales value of eligible AAT products.

• Note 4: Expenditure on land and buildings does not count towards the investment threshold.

• Note 5: You can claim incentives for a product only once, either at the component or vehicle level.

• Note 6: Related party transactions will undergo scrutiny to ensure arms-length pricing.

• Note 7: The base year for calculation of incremental sales is Financial Year 2019-20.

• Note 8: Investments must be in the form of fixed assets (plant, machinery, equipment).

• Note 9: You must maintain separate records for the eligible products to claim incentives.

Step-by-step guide to applying for the PLI Auto Scheme.

1. Register on the official PLI Auto portal (pliauto.in).

2. Create a user profile and verify your email and mobile number.

3. Select the scheme component (Champion OEM or Component Champion) you wish to apply for.

4. Fill in the application form with company details, financial data, and investment plans.

5. Upload the required documents, including financial statements and undertakings.

6. Submit the non-refundable application fee as prescribed.

7. Submit the final application and note the unique Application ID.

8. The Project Management Agency (PMA) will appraise your application.

9. Receive the approval letter from the Ministry of Heavy Industries upon selection.

List of necessary documents for your application.

• Certificate of Incorporation.

• Memorandum of Association (MoA).

• Articles of Association (AoA).

• PAN Card of the Company.

• GST Registration Certificate.

• Audited Financial Statements for the last 3 years.

• Board Resolution authorizing the application.

• Details of Key Managerial Personnel (KMP).

• Detailed Project Report (DPR) with investment plan.

• Integrity Compliance Undertaking (Annexure V).

• General Undertaking by Applicant (Annexure VI).

• Statutory Auditor Certificate on Global Revenue.

• Statutory Auditor Certificate on Global Investment.

• Statutory Auditor Certificate on Net Worth (for new investors).

• Credit Rating Report (if available).

• Shareholding Pattern details.

The PLI Scheme for Automobile and Auto Component Industry offers a significant opportunity for you to scale up manufacturing and adopt advanced technologies. By meeting the investment and sales targets, you can secure substantial financial incentives and enhance your market position. Ensure you review the eligibility criteria and submit your application with all valid documents. You can also explore a Bajaj Markets business loan, MSME loan, or working capital loan for investments. Get a machinery loan or manufacturing loan for expansion needs. Consider an EV loan for related projects.