According to the Cabinet note that the Textiles Ministry finalised, the second iteration of the production-linked incentive (PLI 2.0) plan for textiles is projected to have an outlay of Rs. 4,307 crore and will encompass the manufacturing of garments, made-ups, and textile accessories of all materials, natural or man-made.
“A Cabinet note, together with guidelines, for PLI scheme for apparel/garments, made-ups and textiles accessories, with an outlay of Rs. 4,307 crore, has been finalised and circulated to the Prime Minister’s Office and the Cabinet Secretariat,” an internal note of the Textiles Ministry stated.
The second edition of the PLI scheme for textiles, which is being proposed, will be open for clothing, make-ups, and accessories made of all materials, including cotton. The first edition of the PLI scheme for textiles, established in 2021, is restricted to the manufacture of man-made fibre (MMF) fabrics and apparels, as well as technological textiles.
According to another note, the goal of the proposed PLI 2.0 is to improve India’s manufacturing capabilities in value-added finished textile products, which by their very nature demand little investment but have a large capacity for creating jobs.
“The government decided to go in for second edition of PLI for textiles as the total corpus of Rs. 10,683 crore allocated for the scheme will not get used up as incentives for the 64 selected applicants under the first phase. Going by estimates, just a little over Rs. 6,000 crore will be used,” a source tracking the matter said.
“The qualifying investment under the proposed scheme is likely to be in the Rs. 15-45 crore range, with minimum prescribed turnover of Rs. 30-90 crore, to earn incentives ranging between 8 per cent and 10 per cent,” the source added.
The requirement that applicants form a new firm in order to be eligible for the programme may also be eliminated by the government. Instead, it might permit all companies with Indian registrations to take part, subject to restrictions like keeping separate accounts and only including investments in new machines when determining eligibility.
The proposed PLI 2.0 programme for textiles can be announced and put into effect after receiving Cabinet approval.
