The second edition of the production-linked incentive (PLI) scheme for textiles is likely to offer incentives for manufacturing of garments and home textiles such as blankets and bed spreads, and textile accessories like lace, button, and zippers.
The Textiles Ministry is considering three investment thresholds of Rs. 15 cr, Rs. 30 cr and Rs. 45 cr, with double turnover as the criteria for incentives that would range between 8 percent and 10 percent under the Rs. 4,200 cr scheme. It is also likely to add a minimum number of stitching and sewing machines as another benchmark to avail the sops.
“The scheme will attract investment and reduce the import dependence in textile accessories,” said an official, adding that such value addition sectors are labour-intensive that require low investment but have a high potential to create jobs. The selected companies would have to achieve the minimum turnover, which is two times the investment, in the first year and then 20 percent increase in turnover over the previous year.
PLI 2.0 for the textile sector is being considered as the Ministry has an unutilised budget of about Rs. 4,000 cr after it approved 64 applications with an investment potential of Rs. 19,798 cr and projected turnover of Rs. 1.93 lakh cr in the next five years under the first phase of the scheme.
In the first edition of textile PLI scheme, the minimum investment required was Rs. 100 cr and Rs. 300 cr while the minimum turnover required to be achieved for incentive was Rs. 200 cr and Rs. 600 cr, respectively.
Industry had sought a lower investment threshold of Rs. 25 cr instead of Rs. 100 cr in the second PLI and also a waiver from the condition to set up a new company for the purpose of investment.