Auto PLI scheme: Govt expects Rs 45,000 crore investment over 5 years from 20 vehicle makers

The Narendra Modi government on Friday said it's expecting an investment of Rs 45,000 crore over five years from 20 selected companies under the Performance Linked Incentive (PLI) scheme for the automobile industry in India.

In an exclusive interview to CNBC-TV18, Arun Goel, Secretary, Department of Heavy Industries, said that applicants under the component PLI scheme will be announced in a few weeks.

He said the government will launch a portal by March 1, 2022, for submission of documents for assessment before the rollout of incentives from April 1, 2023, onwards on the basis of sales in FY23. However, the scheme is now closed for original equipment manufacturers (OEMs).

: Middle seat in cars to have Y-shaped belts soon, says report

"This is the only sector where companies have been allowed to apply and get incentives under three schemes. A manufacturer can apply and get incentives under all three schemes - ACC PLI, automotive PLI, and FAME schemes," Goel said.

Secretary said companies that did not get selected under vehicle PLI scheme may be selected under component PLI scheme if they have applied. But companies can get incentives in the range of 13-18 percent. The highest incentive under auto PLI is 18 percent, 20 percent under ACC PLI, and 20-45 percent under FAME.

The ministry said Maruti Suzuki had withdrawn the application under the vehicle PLI scheme as it did not qualify and had said Suzuki Motor may be considered. Maruti has also applied under the component PLI scheme.

Also Read: Ratan Tata takes delivery of custom-built 72V Nano EV which "glides more than it drives"

Yesterday, the central government selected 20 companies across, passenger vehicles, two-wheeler and new non-automotive companies. M&M, Tata Motors, Ashok Leyland, JBM Electric Vehicles, Hyundai India, Pinnacle Mobility, Suzuki Motor Gujarat, VECV, PCA Automobiles, and Kia India have been selected from the list of applicants from carmakers.

Incentives under the Rs 25,938 crore Automotive PLI Scheme will be rolled out from April 1, 2022, for a period of 5 years. Companies would get incentives based on incremental sales of electric or hydrogen fuel cell vehicles. Like Maruti Suzuki, there could be other vehicle manufacturers who may not have been eligible under the vehicle PLI Scheme but may get incentives under the Component PLI scheme.

The government is still considering 86 applications under the Component PLI Scheme. Sources told CNBC-TV18 that a company that is into manufacturing electric batteries and electric vehicles can get incentives under both the automotive and ACC PLI schemes.

Also Read: UP on top, these states have the most EVs in India

Among the prominent two-wheeler makers, TVS, Hero MotoCorp, Bajaj Auto and Piaggio have been selected for incentives. Ola Electric, Booma Innovative, Elest, Hop Electric, Axis Clean Mobility and Powerhaul vehicles have been approved under the new non-automotive category.

Bharat Forge, Ather Energy & Hero Electric did not meet eligibility criteria, for the Vehicle PLI Scheme. The Automotive PLI Scheme aims to incentivise electric and hydrogen fuel cell manufacturing in India, with a roadmap for 30 percent electrification by 2030.