PLI Scheme for Drones and Drone Components
4.9
PLI Scheme for Drones and Drone Components - Benefits & Eligibility
The Production Linked Incentive (PLI) Scheme for Drones and Drone Components is designed to make India a drone manufacturing and innovation destination of the world. Being designed to support both the drones and their components, the PLI Scheme for Drones and Drone Components caters for the increasing demand for drones within the domestic and international market. The PLI Scheme for Drones and Drone components, as an instrument, is aimed at reducing Import dependency, improving competitiveness, research and development of drone manufacturing industry in India. Promoting the state-of-the-art innovation on the drone, the PLI Scheme for Drones and Drone Components opens the door to domestic and international investors to strengthen and diversify the drone manufacturing industry in India.
What is the PLI Scheme for Drones and Drone Components?
The Production Linked Incentive (PLI) Scheme for Drones and Drone Components is introduced with an aim to develop the manufacturing Linkage in drones as well as drone components.
Through enhancing the efficiency of the drone business, the PLI Scheme for Drones and Drone Components aims to raise the rate of production locally and export more of the products instead of importing them. The PLI Scheme for Drones and Drone Components incentivises firms in the targeted sectors by allowing them to claim incentives for their investments in capital equipment and other innovations essential for creating more sophisticated products. The PLI Scheme for Drones and Drone Components will foster the development of an indigenous drone manufacturing industry. Also, the PLI Scheme for Drones and Drone Components fosters the development of new solutions; unleashes employment resulting in India emerging as the largest drone manufacturing hub; creating a vibrant and modern aerospace economy.
Benefits of PLI Scheme for Drones and Drone Components
The Production Linked Incentive (PLI) Scheme for Drones and Drone Components offers several key benefits to India's drone manufacturing sector:
- Strengthen Infrastructure: The PLI Scheme for Drones and Drone Components helps modernize drone manufacturing units, enhance supply chains, and develop critical logistics to enable the drones industry.
- Attract Investments: In the PLI Scheme for Drones and Drone Components, domestic and foreign investors are encouraged to generate a competitive value chain of drones manufacturing to achieve the ultimate goal of making the manufacturing sector self-sustainable.
- Enhance Export Competitiveness: The PLI Scheme for Drones and Drone Components helps to adopt new generation technologies and better quality components for enhancing the exporting competency of Indian drones and drone parts.
- Promote Domestic Manufacturing: The PLI Scheme for Drones and Drone Components requires the development of vital parts and full-body drones necessary for an independent manufacturing system of drones in the country.
- Job Opportunities: The PLI Scheme for Drones and Drone Components was designed to create a large number of jobs in the manufacturing, technology and design of drones and their applications.
Incentives under PLI Scheme for Drones and Drone Components
The following table provides details of the incentive structure and disbursement schedule for the PLI Scheme for Drones and Drone Components over three financial years.
| Claim Year | Sales - Net of GST | Purchase - Net of GST | Eligible Value Addition in India | PLI Rate for Value Addition | Applicable PLI | Disbursement Year |
|---|---|---|---|---|---|---|
| FY 2021-22 | Rs 200 Crore | Rs 120 Crore | Rs 80 Crore | 20% | Rs 16 Crore | FY 2022-23 |
| FY 2022-23 | Rs 400 Crore | Rs 240 Crore | Rs 160 Crore | 20% | Rs 32 Crore | FY 2023-24 |
| FY 2023-24 | Rs 900 Crore | Rs 540 Crore | Rs 360 Crore | 20% | Rs 72 Crore | FY 2024-25 |
| Total | 1500 | 900 | 600 | 20% | 120 | — |
- Total Financial Outlay: The PLI Scheme for Drones and Drone Components is capped at Rs 120 crore over three years.
- Cap per Manufacturer: Each manufacturer is limited to a maximum incentive of Rs 30 crore, which is 25% of the total financial outlay.
- Audit Requirement: The PLI Scheme for Drones and Drone Components includes an audit provision conducted by an external auditor appointed by the Ministry of Civil Aviation.
Eligibility for PLI Scheme for Drones and Drone Components
The PLI Scheme for Drones and Drone Components entails that all the manufacturers of drones in India have to fulfill certain conditions set by the scheme. Companies that supply raw materials for production, main airframe, propellers, engines, power supply, GPS and communication modules, cameras, meters, and safety devices are also permitted. The list of approved drones and their parts for the PLI Scheme for Drones and Drone Components can be changed over time by the Central Government.
Manufacturers are supposed to fulfill some requirements for a company to be eligible for incentives through the PLI Scheme for Drones and Drone Components including sales turnover activity. Turnover limit for Indian MSMEs and startups engaging in drones for PLI Scheme for Drones and Drone Components is set to Rs 2 Crore and for components INR 0.5 Crore. For non MSME Indian companies, it is Rs 4 crores for drones and Rs 1 crore for components. New investors are also to meet these thresholds as well as provide information on their operations in the global markets for determination of eligibility of their securities for inclusion in the Gold index. Thirdly, a component manufacturer can only include the parts for which they advertise PLI Scheme for Drones and Drone Components in certain categories of goods, actionable only if used in a drone.
Conclusion
The Production Linked Incentive (PLI) Scheme for Drones and Drone Components is a prominent scheme to make India a drone manufacturing hub of the world. The PLI Scheme for Drones and Drone Components benefits the domestic drone industry since it encourages local production, hence increasing its competitiveness and supporting structures, and developing its technological requirements by decreasing imports. The PLI Scheme for Drones and Drone Components also invites copious amounts of domestic and international investments, thus making it a strong and closed environment. By offering structure reward, the PLI Scheme for Drones and Drone Components improves infrastructural and export base, generates employment opportunities and promotes innovative culture. In conclusion, the PLI Scheme for Drones and Drone Components integrated India with global supply chains catering to domestic and international markets and making it a manufacturing nation of the future of the aerospace economy.
Frequently Asked Questions
What is the PLI Scheme for Drones and Drone Components?
The PLI Scheme for Drones and Drone Components aims to boost Made in India drones and drone component manufacturing and cut the imports more and innovate to establish India as the drone manufacturing hub in the world.
Who is eligible for the PLI Scheme for Drones and Drone Components?
All drone manufacturers in India, including MSMEs, startups, and non-MSME companies, are eligible for the PLI Scheme for Drones and Drone Components if they meet certain criteria.
What are the sales turnover requirements for the PLI Scheme for Drones and Drone Components?
For MSMEs and startups, the minimum turnover is Rs 2 crore for drones and Rs 0.5 crore for components and for non-MSMEs, the turnover requirement is Rs 4 crore for drones and Rs 1 crore for components, under the PLI Scheme for Drones and Drone Components.
What is the significance of the PLI Scheme for Drones and Drone Components?
The PLI Scheme for Drones and Drone Components positions India as a leading drone manufacturing hub by promoting self-reliance, attracting investments, creating jobs, and boosting exports.
PLI Scheme for Other Sectors
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