Govt to consider up to 20 times incremental sales value for telecom PLI

The government will consider up to 20 times the value of incremental sales of telecom gear makers for doling out production linked incentive, according to the norms notified on Thursday.

The incentive will be given in the range of 4-7 per cent of the incremental sales value to micro, small and medium enterprises (MSMEs) and 4-6 per cent to the rest of the companies for manufacturing telecom equipment under the scheme, which will come into effect from April 1 this year.

"The PLI Scheme will be implemented within the overall financial limits of Rs 12,195 crores only for the implementation of the Scheme over a period of 5 years," the notification said.

Telecom gear makers will need to achieve at least 3 times higher value in sales compared to the investment they are required to make in their plant, other than land and building.

The investment and incremental sales will be calculated from the financial year 2019-20.

The government has set a minimum investment threshold of Rs 10 crore for MSMEs and Rs 100 crore for others, which excluded investment in land and building.

The PLI scheme will be applicable on broadband transmission equipment, 4G and 5G wireless equipment, wifi access points, routers, fibre-to-the-home gears, network switches etc.

The government expects the PLI scheme to position India as a global hub for the manufacturing of telecom and networking products.

The Department of Telecom estimates that the scheme will lead to incremental production of around Rs 2 lakh crore over the five years and attract investment of over Rs 3,000 crore.