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Beroe: India’s PLI scheme to boost textile industry

Jul 31, 2021
Beroe: India’s PLI scheme to boost textile industry

Raleigh, N.C

The PLI scheme of the Indian government aims to strengthen the domestic textile industry by offering incentives to the manufacturing and exporting of some textile products that are made up man-made fibre, according to Beroe Inc.

To mitigate the lasting effects of the Covid-19 situation around the world, the government of India has come up with several steps that include introducing the PLI scheme for various sectors which includes the textile sector as well. PLI here stands for Production Linked Incentive.

According to Pakshaal S Shah, Principal Analyst, Beroe, the government is trying to include cotton-based products in the PLIC scheme as well. The government has an expectation that the demand for both natural and man-made fibres will improve in the coming years.

The government has also proposed some other initiatives like National Technical Textiles Mission and Amended Technology Up-gradation Fund Scheme. The objectives that the PLI wants to achieve are listed below-

?        PLI will give incentives to the companies in case of incremental sales derived from the manufacturing of products in domestic units.

?        An incentive of 7% will be given in the first year if the firms with annual sales of Rs 5 billion are able to raise their turnover by 50%.

?        The scheme will attract foreign investment and encourage domestic producers to expand their units.

?        An incentive that equals 11% of investments will be given to big companies that come up with greenfield projects.

?        9 percent incentive for brownfield projects will be given to companies with annual sales of Rs 1 billion.

The government has also planned to launch 7 mega textile parks in the coming 3 years. These parks will have world-class infrastructure and plug-and-play facilities. The parks will also be supported with facilities like common utilities, power supply, research and development labs, and uninterrupted water. According to Pakshaal S Shah of Beroe, the pandemic has adversely affected businesses. This scheme is a great initiative by the government and if planned well, this scheme will not only support these businesses but will even help them grow. He also said that the textile industry of India is quite resilient. The PLI scheme and other initiatives will bounce back very strongly.

Source – PR Newswire

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