The Department of Telecommunications approved 31 proposals, garnering an investment of ₹3,345 crore over four-and-a-half years under the production-linked incentive scheme for telecom gear.
“The investment of ₹3,345 crore in the next 4.5 years is just a beginning…the government is helping you (industry players) as a catalyst,” said Devusinh Chauhan, minister of state for communications, announcing selected candidates eligible for ₹12,195 crore of incentives spread over the next five years.
The DoT, in an official statement on Thursday, said “a total of 31 companies, comprising 16 MSMEs, 15 non-MSMEs, (8 domestic and 7 global companies) have been given approval,”. The scheme, it said, is effective from April, 2021.
“Investment made by successful applicants in India from April, 2021 onwards and up to FY 2024-25 shall be eligible, subject to qualifying incremental annual thresholds,” the statement added.
Welcoming the PLI announcement, the Telecom Equipment Manufacturers Association said, “this will boost R&D, innovations and help in domestic manufacturing of 4G and 5G”.
Coral Telecom, Ehoome IoT, Frog Cellsat and STL Networks are among the companies selected under the MSME category. Domestic companies under the non-MSME category include HFCL Technologies, Akashastha Technologies, Tejas Networks and VVDN Technologies.
Ericsson’s subsidiary, Jabil Circuit India, Foxconn, Sanmina, Flextronics and Nokia India are among the selected global applicants.
“Investments are likely to generate incremental employment of more than 40,000 people with expected incremental production of around ₹1.82 lakh-crore over the scheme period,” the DoT statement added.
Core transmission equipment, 4G/5G next generation radio access network and wireless equipment, access and customer premises equipment, Internet of things access devices, other wireless equipment and enterprise equipment like switches, routers are some of the products covered under the scheme.
The incentives will be offered over five years subject to the minimum threshold of cumulative incremental investment and incremental sales of manufactured goods. They will range between 4% and 7% for different categories over years.
For MSMEs, 1% higher incentive has been offered in the first, second and third years. The scheme is expected to boost domestic Research & Development of new products on which 15% of the committed investment could be invested.
Financial year 2019-20 will be treated as the base year for calculation of cumulative incremental sales of manufactured goods net of taxes. The fiscal 2021 has not been taken as a base year as pandemic halted overall production in the country.