The Department for Promotion of Industry and Internal (DPIIT) on Friday said that the Finance Expenditure Committee has approved the PLI scheme on air-conditioners and LEDs and that the draft cabinet note has been sent to the Commerce Minister for his consideration.
Last month, DPIIT had sent this proposal to the committee.
In November, the Union Cabinet had approved Rs 6,238 crore outlay for these two sectors, air conditioners and LED lights, under the production linked incentive (PLI) scheme, which aims at making Indian manufacturers' competitive globally.
The scheme would help India become self-reliant, boost manufacturing as well as enhance exports.
The government in November approved the PLI scheme for ten key sectors, including telecom, automobiles and pharmaceuticals, taking the total outlay for such incentives to nearly Rs 2 lakh crore over a five-year period.
The final proposal of the PLI scheme for individual sectors would have to be approved by the Union Cabinet.
The departments concerned would have to implement the scheme.
Finance Minister Nirmala Sitharaman as part of her Budget speech on Monday announced that the government aims to spend Rs 1.97 lakh crore on various PLI schemes over the next five years. This will be an addition to the Rs 40,951 crore announced for the PLI for electronic manufacturing schemes.
The scheme was also a part of the Economic Survey that was tabled in the Parliament on Friday. In the Survey, the government said that the scheme will make "Indian manufacturers globally competitive, attract investment in the areas of core competency and cutting-edge technology." The Survey added that the scheme will also establish backward linkages with the MSME sector in the country, which, in turn, "will lead to more inclusive growth and create huge employment opportunities".
This will be a major step ahead in making India a hub for manufacturing and exports. Under the scheme, eligible players will receive incentives ranging from 4 per cent to 6 per cent of production value for five years, after they achieve their investment and production value target for each year.