DoT Issues New Guidelines For PLI Scheme; To Provide Incentives Worth Rs. 12,195 Crores

The DoT has announced new guidelines for the PLI scheme for telecom and networking equipment makers. The PLI scheme was launched to offer incentives and boost domestic manufacturing in the country. Besides, the Government appointed SIDBI as the project management agency for the scheme.

Under this scheme, the Government will disburse Rs. 12,195 crores in the next five years, out of which Rs. 1,000 crores have been fixed for the MSME category. Besides, the scheme is expected to generate Rs. 3,000 crores along with direct and indirect jobs.

Department of Telecommunication pointed out that the scheme is open to both MSME and non-MSME firms. It includes domestic and global firms. However, the telecom ministry announced that it will approve 10 applications in MSME and non-MSME categories.

Besides, the ministry added that three applicants will be domestic companies. In addition, the applications will be listed from the highest to the lowest.

"Indian manufacturers were hoping that expenses incurred in the R&D be counted towards investment and government has permitted 15 percent of that; secondly, the investment threshold for overseas companies previously was about Rs.300 crore but it has now been brought down to Rs. 100 crore for all non-MSMEs," a senior DoT official said.

PLI Scheme Eligibility Criteria

The ministry states that applicants can register until July 3rd, 2021. However, before registering for the scheme all applicants have to complete the minimum revenue criteria. After that, companies can decide on investment in eligible products.

The Government also announced that MSME needs to make an Rs. 10 crores investment, whereas non-MSME have to invest Rs.100 crores. But, the land or building cost cannot be counted as an investment. Furthermore, the ministry states that eligibility is subject to sales of goods. The scheme is likely to cover several products, such as 4G, 5G, IoT devices, routers, and switches.

It is worth noting that to avail the benefits of the PLI scheme several companies like Ericsson and Nokia are planning to expand their operations in the country. Besides, Cisco, Ciena, Samsung, and more companies are likely to set up manufacturing plants in the country.

It seems that the PLI scheme has been launched to reduce the dependence on the imports of the 4G and 5G equipment as DoT has approved the trials of the upcoming networks. This will also help domestic companies to participate in the trials.