The Production Linked Incentive (PLI) Scheme has led to a production or sales worth Rs 8.7 lakh crore and generated employment for over 7 lakh, according to an economic review released by the Department of Economic Affairs (Under the Ministry of Finance) on January 29.
‘The Indian Economy: A Review’ says 176 MSMEs have directly benefited from the scheme launched in March 2020 to boost production in the country. The PLI Scheme came after industry saw the global supply chain getting severely disrupted due to the pandemic.
The review stated that under the PLI Scheme, which saw an outlay of Rs 1.97 lakh crore, approved 746 applications till the end of December 2023.
“The scheme witnessed over Rs 1.07 lakh crore of investment, leading to production/sales of Rs 8.7 lakh crore and employment generation of over 7 lakh. The scheme has witnessed exports exceeding Rs 3.4 lakh crore, with significant contributions from sectors such as large-scale electronics manufacturing, pharmaceuticals, food processing and telecom and networking products,” it said.
Other achievements under the scheme included reduction in import of pharma raw material, import substitution achieved in telecom, and increase in turnover in the drones’ sector.
Further, the Union Budget FY24 facilitated timely payment for MSMEs and ensured payment of interests on delayed payments.
“Since the payment of such interest is considered penal in nature, no deduction for such interest is allowed under section 37 of the Income Tax Act, 1961. The Udyam portal and the Udyam Assist Platform (UAP) have helped consolidate the information on MSMEs, with 2.24 crore MSMEs registered on the Udyam portal and about 1.2 crore units registered on the UAP,” it read.
Last year in September, the government launched the Pradhan Mantri Vishwakarma Yojana which offers end-to-end support to craftspeople and artisans. The yojana has already attracted 48.8 lakh enrolments as of the end of December 2023.
The review also stated that loans amounting to Rs 25.98 lakh have been disbursed to non-corporate, non-farm SMEs under the Pradhan Mantri Mudra Yojana.
In April 2023, the limit of credit guarantee under the Credit Guarantee Fund Trust for Micro & Small Enterprises (CGTMSE) was raised to Rs 5 crore from Rs 2 crore in April 2023. “Under the Emergency Credit Line Guarantee Scheme (ECLGS), announced under the Aatmanirbhar Bharat package, guarantees to the tune of Rs 2.4 lakh crore have been provided,” it said.
The review said the combined effect of the Mudra Yojana and the ECLGS Scheme has led to an average annual growth of 16.8% in the credit provided by the scheduled commercial banks (SCBs) to the MSMEs during the last two years.
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