The Textile Ministry’s proposal for a new Production Linked Incentive (PLI) plan specifically for the garment and made-ups sector, with reduced minimum investment and production standards, may have been temporarily put on hold, according to a source following the situation.
The proposed PLI programme for apparel and items made of all materials, including cotton, was the focus of the Textiles Ministry’s efforts because it would have benefited many of the nation’s garment manufacturers. But ultimately, what was presented was a PLI 2.0 textiles programme that was a perfect replica of the first one, limited to technical textiles and man-made fibres (MMF), and had the same investment and turnover requirements as before, said the source.
The Finance Ministry rejected the proposal for extending the PLI scheme to garments and made-ups of all materials as it did not want to bring down the minimum threshold limits on investments and turnover to the levels suggested by the Textiles Ministry, the source said.
The Textiles Ministry is confident that by reopening the investor application window until 31st August 2023, it will increase investment, as it recently introduced some flexibility in the criteria governing the original PLI for textiles plan, including conditions surrounding the formation of a new company and investments.
According to an industry representative, three investment levels of Rs. 15 crore, Rs. 30 crore, and Rs. 45 crore were taken into account for the new scheme, with double the revenue serving as the need for incentives. The incentives granted were lower than those under the original PLI plan.
Due to a lack of interest in the initial PLI plan, which had a corpus of Rs. 10,683 crore, the Textile Ministry began work on a new edition. According to calculations, over the course of the following five years, the 64 people who were chosen for the programme would be eligible for incentives totaling Rs. 6,000 crore, leaving a surplus of more than Rs. 4,000 crore.
