By TIOL News Service

NEW DELHI, FEB 24, 2021: THE Cabinet on Wednesday approved the Production Linked Incentive (PLI) scheme for the pharmaceutical and IT hardware sector to boost domestic manufacturing, attract investments in the value chain and create employment opportunities.

The total cost of the proposed schemes is approximately Rs. 15,000 crore for pharmaceuticals in 2020-21 to 2028-29 and around Rs. 7,350 crore over four years for IT hardware.

For IT hardware, the target segments include laptops, tablets, all-in-one personal computers and servers. It will extend an incentive of 1-4 per cent on net incremental sales, over base year 2019-20, of goods manufactured in India.

"The scheme is likely to benefit major global players and 10 domestic champions in the field of IT Hardware manufacturing. This is an important segment to promote manufacturing under Aatmanirbhar Bharat as there is huge import reliance for these items at present," said the Cabinet.

It will enhance the development of electronics ecosystem in the country and position India as a global hub for Electronics System Design and Manufacturing (ESDM) on account of integration with global value chains, thereby becoming a destination for IT hardware exports.

Meanwhile, the PLI scheme for pharmaceuticals will contribute to the availability of wider range of affordable medicines for consumers and is expected to promote the production of high value products in the country and increase the value addition in exports. It is also expected to bring in investment of Rs.15,000 crore in the pharmaceutical sector.

"Total incremental sales of Rs. 2,94,000 crore and total incremental exports of Rs. 1,96,000 crore are estimated during six years from 2022-23 to 2027-28," said the Cabinet.

It is expected to promote innovation for development of complex and high-tech products including products of emerging therapies and in-vitro diagnostic devices as also self-reliance in important drugs. It is also expected to improve accessibility and affordability of medical products including orphan drugs to the Indian population.

One of the further objectives of the scheme is to create global champions out of India who have the potential to grow in size and scale using cutting edge technology and thereby penetrate the global value chains.