As the name suggests, the Production Linked Incentive (PLI) Schemes in India is a scheme that provides incentives to businesses for improving their domestic production apart from concentrating on decreasing import charges and enhancing the price competitiveness of local goods.

Also, these PLI schemes extend incentives on incremental deals for goods manufactured in India. 

The initial three Production Linked Incentive schemes got ratified in March of the previous year, followed by ten new schemes. Also, as per finance minister Nirmala Sitharaman, the Government is planning to invest INR 1.97 lakh crore in the Production-Linked Incentive (PLI) scheme for approximately 13 sector-specific plans, which will generate employment for the young people by developing national production. 

In addition, this scheme was introduced in March 2020 as a part of Atmanirbhar Bharat’s national production expansion strategy.

Here the Indian Government plans to provide young individuals with a business loan in Delhi and the rest of India to increase domestic manufacturing. 

business loan

What is precisely a Production Linked Incentive (PLI) Scheme?

PLI, also known as Production-Linked Incentive, is a government scheme that intends to provide corporations incentives on incremental purchases (over Financial Year 2019-20) from goods produced in residential units. 

This Government scheme encourages international businesses to set up their manufacturing units in India. However, it likewise attempts to reassure local corporations to set up or develop subsisting production units and create more employment to reduce India’s dependence on imports from other nations.

See also  PLI Scheme for Textile - Cabinet Approves ₹10,683 Crore PLI Scheme

Production Linked Incentive (PLI) Scheme background

  • There are food processing companies in all parts of the business in India, from micro-companies to big companies.
  • The nation holds a competitive edge due to its original resource revenue, extensive national business, and potential for developing value-added outcomes.
  • For Indian businesses to accomplish the potential of this division, they must significantly augment their competitiveness vis-à-vis their global equivalent in terms of shipping scale, productivity, and value appreciation and keep their connection with the worldwide value series.
  • Based on AtmaNirbhar Bharat Abhiyan for improving India’s Production Abilities and Advancing exports, the Production Linked Incentive (PLI) scheme for Food Processing Industries was formulated.
  • This PLI Scheme was approved for business sectors such as pharmaceuticals, automobiles, IT hardware such as mobile phones, laptops, & telecom equipment, chemical cells, white goods, food processing, textiles, etc.

Purpose of the Production Linked Incentive (PLI) Scheme

  • This scheme assists food production businesses with a necessary minimum sales level and a readiness to invest funds in expanding their processing capabilities. Also, it helps develop their brands overseas to foster the development of influential Indian brands.
  • Develop champions of food producers over the world.
  • Empower Indian brands of food products so that they get identified globally and trusted globally.

Eligibility criteria to avail the benefits of the Production Linked Incentive (PLI) Scheme

There are several eligibility specifications for companies under the Production Linked Incentive (PLI) scheme based on the industry-certified under the plan. 

Also, companies owning a GST registration in India and remaining involved in the goods manufacturing included under the target parts of the scheme can apply for the benefits under the Production Linked Incentive (PLI) Scheme. In addition, eligibility under the PLI scheme shall remain subject to thresholds of Incremental Investment over the base year. 

See also  How to start a Car & Bike Wash Business in India? Read a Business Plan!

Moreover, an applicant aspiring to avail benefits under this scheme must fulfill threshold standards (i.e., incremental investment) that are a minimum of Rs 10 crore (Medium, Small and Micro Enterprises) or Rs 100 crore (Other companies) and a maximum of Rs 1000 crore) to remain eligible for payment of incentive of this scheme for the year under consideration. 

In addition, to fulfill the threshold standards of Incremental Investment for any financial year, the combined cost of investment made till such year (including the financial year under consideration) over the Base Year. Moreover, some sectors likewise hold threshold guidelines for incremental sales.

The applicant can operate subsisting or new production units at one or more locations in the nation. Also, any additional expense by organizations on the machinery, plant, tools, analysis, development, and substitution of technology for production in the target divisions will remain eligible for the incentive scheme. 

Furthermore, SMEs and other organizations must carry 50% or more of their subsidiary companies, if any, under food processing standards. Also, as per the Ministry of Food Processing Industries, the Government chooses SMEs based on their proposals, the originalities of their goods, and the level of their product evolution, among other determinants. 

On the other hand, for companies related to pharmaceutical services, the project must remain a greenfield one; and the business’s net value must not be less than 30 percent of its cumulative investments.

See also  Interest Subsidy for MSME Exporters Increased to 5% from 3%

In addition, the organization should present a Domestic Value Addition (DVA) of approximately 90% for fermentation-based produce and at least 70% for biochemical structures. 

Apply for Business Loan

Steps to apply for availing of benefits under the Production Linked Incentive (PLI) Scheme

  • Any company having a GST registration can apply for availing of benefits under this PLI plan. 
  • The number of requests permitted per applicant for assistance under the scheme shall remain restricted to one.
  • Project Management Agency (PMA) to get the application (over an Online Portal) for initial examination and issue receipt within 15 days after completion of an inspection.
  • Every application shall remain evaluated, and specifications shall be recorded in the comprehensive checklist by the PMA upon acceptance of the application.
  • The PMA will make suitable recommendations to the Technical Committee (TC) for consents under the PLI Scheme.
  • The concluding recommendations of the PMA and the Technical Committee shall put it before the Empowered Committee (EC) for its endorsement.
  • All the applications shall get settled within 60 days from the day of issuance of confirmation of application acceptance. 
  • The applicant will receive an approval letter within five working days of getting permission from the Competent Authority.

If you are an existing business owner looking for a business loan or a textile loan to avail of the benefits of the Production Linked Incentive (PLI) Scheme, Ziploan can be your perfect partner.

Ziploan is a leading NBFC that can help you get an unsecured loan at the most affordable interest rates. To know more, visit

textile loan

Related Posts

MSME Full FormSmall Scale-IndustriesNSIC
Goat Farming LoanUdyog AadharDairy Farm Loan
Shop LoanWhat is CGSTDownload GST Certificate
GST BenefitsCancelled ChequeUPI Full Form
Business Loan EligibilityGST Full FormE-Way Bill
CIN NumberGST LoginUAN Number