In response to feedback from industry associations and beneficiaries of the Production-Linked Incentive (PLI) scheme for white goods, the government has implemented several changes to streamline the scheme’s operation and enhance the ease of doing business. The alterations include the adoption of the cost-plus method instead of the CUP (comparable uncontrolled price) method for calculating sales prices in the case of captive consumption or supplies to group companies. This change necessitated an amendment in the definition of ‘arm’s length.’
Additionally, investments in tool rooms for manufacturing molds and dies are now considered eligible under Capital Investment. Beneficiaries are now allowed an extra year, beyond the initially permitted two years, to inform about the establishment of an additional manufacturing facility. The last date for claim submission and refund of excess incentive has been revised, and site visits by the administrative ministry have been introduced.
To promote self-reliance under the Atmanirbhar Bharat initiative, the PLI scheme for white goods, focusing on the manufacturing of components and sub-assemblies of air conditioners (ACs) and LED lights, was approved in April 2021. The scheme, spanning seven years from FY22 to FY29, with an outlay of Rs 6,238 crore, aims to establish a comprehensive component ecosystem for the ACs and LED lights industry. The Department for Promotion of Industry and Internal Trade (DPIIT) expects this initiative to boost domestic value addition from the current 15-20% to an impressive 75-80%, making India a crucial player in global supply chains. Out of the 64 selected beneficiaries, 15 have commenced commercial production after opting for a gestation period up to March 31, 2022, while others are in various stages of implementation.
