Centre holds Samsung's incentive of Rs 900 cr under PLI scheme for FY21

The central government has held the disbursement of incentive amount under the PLI scheme to Samsung Electronics for FY21 after some discrepancies were found in the invoices

The central government has held the disbursement of incentive amount under the production-linked incentive (PLI) scheme to Samsung Electronics for FY21 after some discrepancies were found in the invoices, reported The Financial Express on Tuesday.

According to the report, there were differences between the incremental production and sales shown by Samsung and the ones arrived by the Centre. 

The Korean tech giant, which was the only firm that qualified for PLI for FY21, had claimed incentives worth nearly Rs 900 crore for the financial year, however, the Centre's calculations had pegged it lower. 

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The government has sought some clarifications from the company, after which the Centre will disburse the incentive amount, officials told FE. “At the moment we cannot say by when the incentive amount would be disbursed to the company and how much,” officials told the newspaper.

This delay in disbursement for Samsung comes at a time when the Centre on September 9 approved 32 beneficiaries under the PLI scheme for large-scale electronics manufacturing for FY22. 

Domestic firm Padget Electronics was the first company to receive a disbursement of around Rs 50 crore based on its incremental investment and sales figures for the fiscal year. Other firms eligible for incentives this year include Samsung, Apple’s contract manufacturers Wistron, Foxconn, and Rising Star. 

The government will give incentives under the PLI scheme that started in August 2020 to a total of ten firms, which include five global and five local companies. 

Samsung in FY21 clocked incremental sales of around Rs 15,000 crore, which is also the ceiling for availing of the incentive, reported FE quoting industry sources. 

For smartphone firms, the total outlay over five years is Rs 40,951 crore and the incentive ranges from nearly 4-6 per cent annually. For FY21, the incentive was Rs 5,334 crore, while the threshold for qualifying was incremental sales of Rs 4,000 crore and a maximum of Rs 15,000 crore. 

According to this calculation, Samsung was entitled to get Rs 900 crore — six per cent of Rs 15,000 crore — as an incentive from the government, reported FE.