What is PLI Scheme for Textiles
The PLI Scheme for Textiles was launched by the Indian government in September 2021 to promote Man-Made Fibre apparel and products of Technical Textiles. The primary aim of the incentive scheme was to support the Indian textile industry in scaling up and becoming globally competitive.
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The scheme had a budget outlay of Rs 10,683 crore for a period of five years, targeting the encouragement of investment in the textile industry in rural areas and Tier 3 and Tier 4 cities of India.
Conditions for availing PLI benefits
According to the scheme outlay, there are two parts of the PLI Scheme for Textiles. Depending on the investment threshold, the incentive for manufacturers differs each year. In the first part, a person or company must invest at least Rs 300 crore in plant, machinery, equipment, and civil works, excluding land and administrative building costs, within the first two years. In the third year, the company needs to achieve a turnover of Rs 600 crore to qualify for a 15 per cent incentive. In the fourth year, the turnover threshold is raised to Rs 750 crore, and the incentive is set at 14 per cent.
Under the second part of the PLI Scheme, the minimum investment for the first two years is Rs 100 crore to qualify for the scheme. In the third and fourth years, the company is required to post a turnover of Rs 200 crore and Rs 250 crore, respectively, to qualify for an incentive of 11 per cent and 10 per cent.