PLI Scheme for Textile Products
4.9
Production Linked Incentive (PLI) Scheme for Textile Products
The Production Linked Incentive (PLI) Scheme for Textile Products aims to make India a competitive manufacturing destination for textile products in MMF apparel, MMF fabrics and Technical Textiles. The PLI Scheme for Textile Products boosts domestic manufacturing to invest and reduce imports along with the development of the textile value chain of India. The PLI Scheme for Textile Products for the expansion of important sectors, with an intention to improve the position of Indian textiles players in the global market.
The PLI Scheme for Textile Products also has the objectives of creating massive employment opportunities, exports enhancement and importantly, the usage of Indian upstream textile products to increase the ‘Indian’ footprint on global value chain. The PLI Scheme for Textile Products incentivises eligible manufacturers and is tied to turnover and performance and is designed to encourage production on a vast scale to help make the textile industry in India strong, healthy and active for the long term.
Table of Content
- What is the PLI Scheme for Textile Products?
- Benefits of PLI Scheme for Textile Products
- Scheme Details of PLI Scheme for Textile Products
- Incremental Turnover and Incentive Rate of PLI Scheme for Textile Products
- Categories for PLI Scheme for Textile Products
- Eligibility Criteria and Conditions for PLI Scheme for Textile Products
- Conclusion
- Frequently Asked Questions
What is the PLI Scheme for Textile Products?
The PLI Scheme for Textile Products is a government initiative to encourage the domestic manufacturing of MMF apparels, fabrics and technical textile products. The PLI Scheme for Textile Products aims at increasing the size of the fabricating structure of the textile industry in India and becoming capable enough to compete with the international market. Thus, the textiles sectors which have been incentivised by the PLI Scheme for Textile Products shall also gain from reduced import dependence, bolstering of a strong manufacturing ecosystem, and employment generation throughout the value chain. The PLI Scheme for Textile Products has targeted an approach aimed at building a practical and feasible fabric market for the textile industry in India.
Benefits of PLI Scheme for Textile Products
The Production Linked Incentive (PLI) Scheme for Textile Products provides significant advantages to the textile industry in India, including:
- Attract Investments: The PLI Scheme for Textile Products improves the investment prospects of the textile industry as domestic and international investors are encouraged to invest.
- Economic Development: The PLI Scheme for Textile Products was designed to spur the textile manufacturing industry and therefore, the economy and the international recognition India has in the textiles market.
- Promote Domestic Manufacturing: The PLI Scheme for Textile Products decreases dependency on imports and boosts manufacturing of higher-value textiles products in India.
- Infrastructure Growth: The PLI Scheme for Textile Products supports the amplification of the manufacturing environment for textile products, improving industrial parks and logistics, as well as links optimum for the textile segment.
- Employment Opportunities: The PLI Scheme for Textile Products facilitates incentive policy to set up new capacity which generates employment opportunities within the textile sector value chain.
Scheme Details of PLI Scheme for Textile Products
The Production Linked Incentive (PLI) Scheme for Textile Products offers structured incentives based on investment and performance, divided into two main categories:
-
Scheme Part-1
Incentives Details Eligible Entities Companies, Firms, LLPs, or Trusts establishing a separate manufacturing entity under the Companies Act, 2013 Minimum Investment Requirement Rs 300 crore (excluding land and building costs) Turnover Requirement Rs 600 crore minimum turnover from producing and selling notified textile products in the first performance year Incentive Eligibility Entities can claim incentives upon meeting the investment and turnover criteria -
Scheme Part-2
Incentives Details Eligible Entities Companies, Firms, LLPs, or Trusts establishing a separate manufacturing entity under the Companies Act, 2013 Minimum Investment Requirement Rs 100 crore (excluding land and building costs) Turnover Requirement Rs 200 crore minimum turnover from producing and selling notified textile products in the first performance year Incentive Eligibility Entities can claim incentives upon meeting the investment and turnover criteria
The incentive schemes of PLI Scheme for Textile Products are proxied using the threshold levels of investment made by participants and turnover levels reached. Where the specified turnover is not attained on time, incentives from PLI Scheme for Textile Products can be claimed from the year of compliance but at the rate of the first year solicited incentive rate, and for the remaining years.
Incremental Turnover and Incentive Rate of PLI Scheme for Textile Products
Incentives through PLI Scheme for Textile Products are also given on every financial year, calculated based on the turnover mentioned for that year and a turnover increment of not less than 25% over the turnover of the immediate previous year but not exceeding 35%. For a participant to be qualified for incentives, he or she should have achieved a DTT of not less than 25% and the annual turnover as prescribed below: But they are allowed to apply for the incentive in the following years if they attain the turnover of the year and a 25% growth from the previous year, yet the incentive years will be limited.
Categories for PLI Scheme for Textile Products
The PLI Scheme for Textile Products classifies cities into three categories based on industrial and infrastructure factors:
| Groups | Cities |
|---|---|
| Group 'A' | Greater Mumbai, Delhi NCR, Kolkata, Chennai, Bengaluru, Hyderabad, Pune. |
| Group 'B' | Ahmedabad, Bhubaneswar, Chandigarh, Coimbatore, Indore, Jaipur, Kochi, Lucknow, Madurai, Mangalore, Nagpur, Thiruvananthapuram, Tiruchirappalli, Vadodara, Visakhapatnam. |
| Group 'C' | All other cities in India, except those in Groups A and B. |
Eligibility Criteria and Conditions for PLI Scheme for Textile Products
Incentive claims for PLI Scheme for Textile Products are allowed only if the participants pass the threshold of investment and/or turnover. For a unique financial year, if the participant fails to achieve the specified incremental turnover for PLI Scheme for Textile Products then s/he will not be able to get incentive of that particular year. The companies may however, be eligible for PLI Scheme for Textile Products in the subsequent years up to the Performance year 5/FY 2028-29, in case they fulfills the turnover criteria of the subsequent years. Both the absolute turnover for the category of notified products and incremental turnover for PLI Scheme for Textile Products should be commensurate with the production capacity created under the scheme to be incentivised.
Conclusion
The Production Linked Incentive (PLI) Scheme for Textile Products is important for building up the manufacturing capability in MMF apparel, MMF fabrics, and technical textiles in India. The PLI Scheme for Textile Products aims to stimulate domestic production, attract investments and infrastructure improvements to create a viable textile sector. The PLI Scheme for Textile Products incentivises industry players to make huge investments with high turnover achievement to access incentives thus growing the economy, import substitution and export capacity. The PLI Scheme for Textile Products produces significant employment opportunities making the value chain of India’s textile sector better.
Frequently Asked Questions
What is the objective of the PLI Scheme for Textile Products?
The PLI Scheme for Textile Products is to increase the production of MMF Apparel, MMF Fabrics, and Technical Textiles in India to promote domestic manufacturing, attract investments, employment generation, and reduce Imports.
Who can apply for the PLI Scheme for Textile Products?
Entities can be companies or firms or LLPs or trusts opting to form a new manufacturing unit under section 8 of Companies Act, 2013 have to follow certain criteria of investment and turnover level under the format of the PLI Scheme for Textile Products.
What are the benefits of the PLI Scheme for Textile Products?
The PLI Scheme from Textile Products enhances domestic production, encourages Investment, Reduces import propensity, upgradation of physical infrastructure, and employment generation in Textile section.
How does the PLI Scheme for Textile Products contribute to economic growth?
The PLI Scheme for Textile Products leads to economic development through the incentives provided for scaling up production, attracting FDI, and employment generation to intensify India’s competitiveness in the global textile sector.
PLI Scheme for Other Sectors
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