Government approves production exemption for automobile, drone industries

Union Minister Anurag Thakur said that production linked incentives would be available on incremental production for five years, subject to conditions on investment and revenue.

Thakur said that the production linked incentive scheme has proved to be very successful, the benefits of which are visible in all sectors.

The government has approved production-linked incentives for the auto, auto component and drone industries to enhance India’s manufacturing capacity, Thakur said after the cabinet approved the plan.

The total outlay of this scheme is ₹26,058 crores. Out of this the auto sector will get ₹25,938 crore, while the outlay for drone production will be received ₹120 crores. Thakur said that the idea is to promote the production of advanced automobiles, auto components and drones and to create champion industries in these sectors.

The scheme focuses on advanced automotive technologies. It covers the production of all segments of battery electric vehicles and hydrogen fuel cell vehicles as well as advanced automotive technology components of vehicles, fully knock down or semi-knock down kits, vehicle assemblies of two wheelers, three wheelers, passenger vehicles has gone. Commercial vehicles and tractors.

It is estimated that in about five years ₹The minister said that additional investment of Rs 47,500 crore would come in the auto and drone sectors, which would create about 760,000 new employment opportunities. The scheme is part of 13 areas that the government has identified to promote local production. Thakur said that the scheme would help in increasing India’s share in the global automobile industry.

More new investment in the auto sector alone ₹Income expected to exceed Rs 42,500 crore in five years ₹2.3 trillion incremental production. On the other hand, incentives for drone production are expected to attract more ₹5000 crore investment in three years, achieving incremental production of maximum ₹1,500 crores. The advanced chemistry cell and similar schemes already launched for electric vehicles are expected to boost electric mobility.

Industry body PHDCCI President Sanjay Agarwal said the plan for the auto sector will lay more emphasis on technologically innovative auto components, such as automatic transmissions, sensors, tire pressure monitoring systems, battery electric vehicles and hydrogen cells. .

Apart from promoting local manufacturing, the scheme aims to add new jobs and help increase exports. India exports automobiles worth $12 billion and parts worth $15 billion but imports components worth $17 billion. The minister said that the scheme is expected to reduce imports.

While the fiscal support will boost companies’ bottom line, the government expects the incremental sales received by the industry to recover its fund outgo through tax collections.