Auto OEMs sceptical on PLI payments
NEW DELHI : Companies applying for the automotive and auto components production-linked incentive (PLI) scheme fear they may not be able to meet all of the government’s requirements to receive the incentives this fiscal, multiple industry sources said, citing lengthy, “onerous" and complex procedures. Their scepticism comes even as the ministry of heavy industries (MHI) is keen to start disbursing incentives under the ₹45,000 crore scheme on a quarterly basis.
So far, only two applicants to the OEM (original equipment manufacturer) PLI scheme— Mahindra & Mahindra and Tata Motors —have been able to submit domestic value addition (DVA) documents. M&M is already approved for DVA and Tata Motors is likely to receive DVA certification in a week.
There is lack of clarity on the procedures to claim incentives, with the industry holding discussions with the government on the matter. Meanwhile, industry body PHD Chamber of Commerce has sent a representation to the MHI, seeking an extension of the timelines that qualifying applicants have been given to submit their DVA certification.
OEMs also point to complexities in obtaining and sharing trade-sensitive data from suppliers pertaining to domestic value addition in parts, a process that they say needs “significant rationalization and streamlining" if incentives are to be disbursed on a quarterly basis. The government did not disburse any incentives to OEMs under the scheme in its first year.
It is now pressing OEMs to apply for DVA approvals faster. “The auto PLI scheme provides that an application for claim of incentives in respect of any financial year shall be made within six months from the end of the fiscal year and therefore the applicants under the said scheme are required
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