Registration of companies in the manufacturing sector at record high, the impact of PLI scheme is visible: Report

Economy will get benefit from PLI scheme

The registration of companies in the manufacturing sector has reached the highest level in the last 7 years and the share of manufacturing companies in the total registration has been the highest in the last 10 years.

Production Based Incentive Scheme ie PLI Scheme ,Production-Linked incentives) is expected to benefit the domestic economy a lot. With the help of this scheme, GDP (GDP) can see an increase of 4 percent annually in the form of incremental revenue. This estimate has been given in the report of Emkay Investment Managers. Under the scheme, an incentive of Rs 2.4 lakh crore is to be given in the next 5 years. Which will be available by companies in different sectors on the basis of the production increased by them. According to the report, the maximum response under this scheme has been received from the electronic, auto component and pharma sectors.

Registration of companies increased due to PLI scheme

It has been said in the report that in view of the returns received under the scheme, the manufacturing companies are continuously expanding their capacity. This is evident from the number of new manufacturing companies registered during this period. According to the report, the registration of companies in the manufacturing sector has reached the highest level in the last 7 years and the share of manufacturing companies in the total registration has been the highest in the last 10 years. At the same time, the application and permission for environmental clearance was at the highest level in the financial year 2021-22, which is 10 times as compared to 2014-15. The reason for this acceleration in the report has been attributed to the changes made by the government between 2018-21. The report said that China dominated in attracting companies in terms of manufacturing. Although strict restrictions on the epidemic in China, trade restrictions on Chinese companies, as well as the weakness of the rupee against China, have also proved to be more attractive for investors than China.

Scheme to reduce imports and increase employment

According to the government, with the help of production linked scheme, the government wants to achieve two goals. First, with the help of indigenous production, the government is hoping to reduce imports. At the same time, there is an effort to increase production capacity and increase employment through new investment. The government has announced PLI scheme for a total of 14 sectors. This includes automobiles and auto components, electronics and IT hardware, telecommunications, pharmaceuticals, solar modules, metals and mining, textiles and drones, etc.