THE PRODUCTION LINKED INCENTIVE(PLI) SCHEME FOR PROMMOTING DOMESTIC MANUFACTURING OF WHITE GOODS (AIR CONDITIONERS & LED LIGHTS)

INTRODUCTION:

The Department for Promotion of Industry and Internal Trade (DPIIT) on Friday said it will provide incentives worth Rs 6,238 crore over a period of five years for manufacturing white goods–air conditioners (ACs), LED lights–in India, a part of its production-linked incentive (PLI) scheme.

The scheme will be effective from the date of its notification. Eligible Investments made in terms of Scheme guidelines, on April 1, 2021 or thereafter, shall be reckoned for considering the incentive under the Scheme.

TENURE OF THE SCHEME:

The tenure of the Scheme shall be from Financial Year 2021-22 to Financial Year 2028-29.

THE OBJECTIVE OF THE SCHEME:

• The objective of the scheme is to create complete component ecosystem in India and make India an integral part of the global supply chains.
• With due consultations with industry and other stakeholders, DPIIT issued detailed Scheme Guidelines for effective operation and smooth implementation of the Scheme.
• The Scheme is expected to attract global investments, enhance manufacturing and generate large scale employment opportunities.

APPLICATION:

• The application window for the scheme will be open from JUNE 15 to SEPTEMBER 15 this year on on-line portal having URL as https://pliwhitegoods.ifciltd.com/.
• No application shall be accepted after the closure of the application window.
• One entity may apply for any one category under one target segment only. However, separate group companies may apply for different target segments.

APPLICATION FEE UNDER THE SCHEME TO BE PAID TO DPIIT:

An application fee of INR 1,00,000/- shall have to be paid electronically through NEFT/RTGS/ to DPIIT.  The details of bank account for fee payment shall be provided on the application portal.

PROJECT  MANAGEMENT AGENCY (PMA):

• The scheme will be implemented through a project management agency (PMA) which will be responsible for providing secretarial, managerial and implementation support.
• The agency would monitor the progress of the project made by the selected applicant as and when required with respect to the committed investment and may carry out physical inspections of an applicant’s manufacturing units and offices.
• In the application form, an applicant would have to provide information such as shareholding pattern, committed cumulative investment, details of board of directors and key management personnel, promoter, and annual plan for domestic value addition, and details of each group company.

ELIGIBILITY:

• Investment in land and building (including factory building or construction) required for the project or unit will not be covered under the scheme and therefore shall not be considered for determining eligibility under the scheme.
• Expenditure on consumables and raw material used for manufacturing shall not be considered as an investment.
• No second hand/used refurbished plant, machinery equipment, utilities shall be used to manufacture the eligible product.
• In case an applicant does not meet the criteria of threshold investment and threshold net incremental sales for any given year, it would not be eligible for disbursement of incentive for that particular fiscal.
• The investment will include expenditure incurred on new plant, machinery, equipment and associated utilities, research and development (R&D), and transfer of technology relating to the facilities setup for the products.
• Investment in R&D should not exceed 15 percent of the total committed investment
• Value -Added Resellers shall not qualify under the scheme.

QUANTUM OF INCENTIVE:

• The scheme shall extend incentives ranging from 4% to 6% on net incremental sales of eligible products over the sale of eligible products in the base year to the selected applicants conforming to eligibility.
• The scheme is Fund Limited. The amount of incentive shall be capped on the following basis:

1. For Air Conditioners- net incremental sale of eligible product upto 5 times of the cumulative threshold investment in the previous financial year.
2. For LED Lights- net incremental sale of eligible product upto 6 times of the cumulative threshold investment in the previous financial year.

LIST OF ATTACHMENTS IN PLIWG APPLICATION FORM:

• Certificate of incorporation & Corporate Identification Number (CIN)
• Memorandum of Association and Article of Association

• IEM/IL/MSME Certificate
• PAN card
• GSTIN Registration Certificate

• Importer Exporter Code (IEC) Registration Certificate
• Audited Financial Statement of FY 2019-20

• Audited Balance Sheet & Profit and Loss Statement of FY 2019-20
• Chartered Accountant Certificate for existing investment in plant & machinery (Gross Block), Net sales revenue & Net worth as on 31.03.2020
• Shareholder Structure

• Top 10 Shareholders list as on 31.03.2020
• Resolution from Board of Directors
• Letter authorizing the signing authority

• Technology Transfer Agreement, if any.

• Detailed manufacturing Flow Chart with Inputs required in each stage in the process flow chart and the output at each stage of Manufacturing.
• Other business agreements.

For queries, you may connect on rajnikant@rmpsco.com

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