Government Approves ₹246 Crore Incentive Claims under PLI Scheme for Auto Industry

The Ministry of Heavy Industries has approved incentive claims totalling ₹246 crore for Tata Motors and Mahindra & Mahindra under the Production-Linked Incentive (PLI) scheme for the automobile and auto components industry. This move is part of the government’s ₹25,938 crore initiative to promote advanced automotive technology (AAT) and localised manufacturing in India.

Incentive Details and Beneficiaries

Minister for Heavy Industries and Steel, H D Kumaraswamy, commended the progress made by original equipment manufacturers (OEMs) in strengthening local production capabilities. Tata Motors and Mahindra & Mahindra have been recognised for their contributions under the PLI scheme.

Tata Motors Incentives

• Claim Amount: ₹142.13 crore as per reports 
• AAT Sales in FY 2023-24: ₹1,380.24 crore
• Eligible Products: Tiago EV (electric car), Starbus EV (electric bus), and Ace EV (electric cargo vehicle)

Mahindra & Mahindra Incentives

• Claim Amount: ₹104.08 crore
• AAT Sales in FY 2023-24: ₹800.59 crore
• Investment: ₹ 978.30 crore
• Eligible Products: e3W models, including Treo, Treo Zor, and Zor Grand, contributing ₹ 836.02 crore

Key Features of the PLI Scheme

The PLI scheme was launched on 15 September 2021, to incentivise innovation and manufacturing capabilities in electric vehicles (EVs) and hydrogen fuel cell technologies. It operates from FY 2023-24 to FY 2027-28, with disbursements scheduled between FY 2024-25 and FY 2028-29.

• Incentive Rates:
  • 13–18% for EV and hydrogen fuel cell components
  • 8–13% for other AAT products
• Eligibility Criteria:
  • Minimum 50% domestic value addition
  • Consideration of both domestic and export sales

Impact and Future Prospects

The scheme has already facilitated an investment of ₹20,715 crore as of September 2024, generating incremental sales worth ₹10,472 crore. The first incentive disbursement is expected to commence in FY 2024-25, encouraging more manufacturers to leverage this opportunity.

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