Auto PLI Disbursals Likely to Hit ₹4,000 Crore by FY27

The Production-Linked Incentive (PLI) scheme for automobiles and auto components has been allocated ₹5,939.87 crore in the FY27 Budget, compared with ₹2,091.26 crore a year earlier, as per The Economic Times report. 

The higher allocation comes as more manufacturers become eligible to claim incentives after meeting the scheme's production and investment targets. Payments during the current year will be linked to incremental sales achieved in FY26. 

Bajaj Auto Gets First Incentive 

Bajaj Auto has become the first company to receive an incentive under the Auto PLI scheme in FY27. As per the report, Bajaj Auto was the first manufacturer to submit and complete the claims process for the current financial year. 

According to the report, the company has received around ₹750 crore, with the claim processed last week. The payment is linked to nearly ₹6,000 crore in incremental sales reported by the company. 

Scheme Linked to Manufacturing Targets 

The Auto PLI scheme was approved in September 2021 with a total outlay of ₹25,938 crore. It provides incentives to eligible automobile and auto component manufacturers that meet specified targets for incremental production, fresh investment, and domestic value addition.  

Incentive payments have been available for eligible performance beginning from FY24. In August 2024, Bajaj Auto said 13 vehicles, including two-wheelers and three-wheelers, had been approved under the scheme after meeting the required domestic value addition norms. 

Sales and Disbursals 

As per the report, the Ministry of Heavy Industries had estimated in December 2025 that companies covered under the Auto PLI scheme generated eligible sales worth ₹32,879 crore.  

In a separate reply in Parliament, Minister of State for Heavy Industries Bhupathiraju Srinivasa Varma said ₹1,350.83 crore had been disbursed to 5 applicants under the scheme. 

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Conclusion 

With a higher budget allocation and fresh claims under review, incentive disbursals under the Auto PLI scheme are to increase in FY27. Payments will depend on eligible sales and compliance with the scheme's conditions. 

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