Important Indian Scheme · Manufacturing

Production Linked Incentive (PLI) Scheme

Incentive scheme to boost domestic manufacturing, attract investment and make India a global manufacturing hub.

Launched
2020
Sectors
14
Outlay
~₹1.97 lakh crore
Linked To
Atmanirbhar Bharat

Overview

The Production Linked Incentive (PLI) Scheme was introduced in 2020 as a key part of the Atmanirbhar Bharat initiative to boost domestic manufacturing and reduce import dependence. Under the scheme, the government provides financial incentives to companies on incremental sales of products manufactured in India over a base year. Starting with three sectors, it was later expanded to 14 key sectors with a combined outlay of about ₹1.97 lakh crore. The scheme aims to enhance India’s manufacturing competitiveness, create jobs, attract investment, and integrate Indian industry into global supply chains.

Key Features & Objectives

  • ✓Provides incentives (typically 4–6% on incremental sales) to eligible manufacturers over a base year.
  • ✓Covers 14 sectors including electronics, pharmaceuticals, automobiles, telecom, textiles, food processing and solar PV modules.
  • ✓Total outlay of approximately ₹1.97 lakh crore across all sectors.
  • ✓Aims to reduce import dependence and promote export-oriented manufacturing.
  • ✓Designed to create large-scale employment and attract both domestic and foreign investment.

Key Facts at a Glance

Launch Year 2020
Part Of Atmanirbhar Bharat Abhiyan
Number of Sectors 14
Total Outlay ~₹1.97 lakh crore
Typical Incentive 4–6% on incremental sales
First Sectors Mobile/Electronics manufacturing, Pharma, Medical devices
Objective Boost domestic manufacturing & exports
📝 Exam Focus: Note the launch year (2020), 14 sectors, ~₹1.97 lakh crore outlay, and the link to Atmanirbhar Bharat.

Practice MCQs

Q1. The PLI Scheme was launched as part of which larger initiative?
A. Make in India only
B. Atmanirbhar Bharat Abhiyan ✔
C. Digital India
D. Startup India
Q2. In which year was the PLI Scheme first introduced?
A. 2018
B. 2019
C. 2020 ✔
D. 2021
Q3. How many sectors are currently covered under the PLI Scheme?
A. 10
B. 12
C. 14 ✔
D. 16
Q4. The PLI incentive is generally provided on which basis?
A. Total production value
B. Incremental sales over a base year ✔
C. Number of employees
D. Land acquired
Q5. What is the approximate combined outlay of the PLI Scheme across all sectors?
A. ~₹50,000 crore
B. ~₹1 lakh crore
C. ~₹1.97 lakh crore ✔
D. ~₹3 lakh crore