Government Announces Significant Revisions to PLI Scheme for Textiles
The Indian textile ministry has unveiled substantial amendments to the Production Linked Incentive (PLI) Scheme aimed at revitalizing the textile sector. These changes, announced on Thursday, are designed to tackle existing industry challenges and stimulate new investments. Key revisions include a reduction in the minimum investment threshold and a significant lowering of the incremental turnover criteria, reflecting the government’s commitment to enhancing the ease of doing business and bolstering India’s position in the global textile market.
Key Amendments to the PLI Scheme
The revised PLI Scheme introduces several important changes to benefit the textile industry. Notably, the government has expanded the list of eligible products for financial support, adding eight new HSN codes for man-made fiber (MMF) apparel and nine for MMF fabrics. This expansion aims to encourage a broader range of manufacturers to participate in the scheme. Additionally, the minimum investment requirement for new applicants has been halved, decreasing from ₹300 crore to ₹150 crore for Part-1 and from ₹100 crore to ₹50 crore for Part-2 of the scheme. These adjustments are expected to significantly lower entry barriers for businesses looking to invest in the textile sector.
Revised Turnover Criteria
Another significant change in the amended PLI Scheme is the adjustment of the incremental turnover criteria. Previously set at 25%, the new requirement mandates that applicants demonstrate a minimum of 10% incremental turnover over the previous year to qualify for incentives starting from the second year. This reduction is intended to facilitate easier access to incentives for companies and promote growth within the industry. The textiles ministry emphasized that these revisions will streamline processes and encourage quicker project execution, ultimately supporting the sector’s expansion.
Extended Application Period
To further promote participation, the textiles ministry has extended the application period for the PLI scheme until December 31, 2025. This extension allows more companies to apply and benefit from the incentives provided under the scheme. The PLI Scheme for Textiles was initially launched on September 24, 2021, with the goal of enhancing the production of MMF apparel, fabrics, and technical textiles in India. The initiative aims to help the industry scale up, improve competitiveness, and create employment opportunities.
Current Participation and Investment
As of now, a total of 74 companies have been selected as beneficiaries under the PLI scheme, with a committed investment of ₹28,711 crore. This participation reflects the industry’s positive response to the government’s efforts to stimulate growth and innovation in the textile sector. The amendments to the PLI Scheme are expected to further attract investments and enhance the overall performance of the textile industry in India, reinforcing its position as a key player in the global market.
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