Budget 2024: Allocation for Auto PLI rises over seven-fold to Rs 3,500 cr

The government on Thursday announced an over seven-fold increase in allocation for the automotive industry's production-linked incentive scheme for 2024-25 to Rs 3,500 crore, the interim budget documents showed.

According to the Expenditure Budget, a sum of Rs 3,500 crore has been earmarked towards the Production Linked Incentive (PLI) scheme for automobiles and auto components in the financial year beginning March, up from a revised estimate of Rs 483.77 crore in the current fiscal.

Additionally, the budget for the PLI scheme for advanced chemistry cell and battery storage has been hiked from Rs 12 crore to Rs 250 crore in 2024-25.

The Ministry of Heavy Industries recently extended the tenure of the PLI scheme for automobile and auto components by one year, with incentives now applicable for five consecutive financial years starting 2023-24.

The Union Cabinet had approved the PLI-Auto scheme on September 15, 2021 with a budgetary outlay of Rs 25,938 crore for a period of 5 years (FY2022-23 to FY2026-27).

The PLI-Auto scheme aims to boost manufacturing of Advanced Automotive Technology (AAT) products, help facilitate and promote deep localization for AAT products and enable creation of domestic as well as global supply chain.