Government Approves Incentive Claims for Tata Motors and M&M under PLI Initiative

New Delhi, Jan 3 (NationPress) The Ministry of Heavy Industries has given the green light to incentive claims amounting to Rs 246 crore filed by Mahindra & Mahindra (M&M) and Tata Motors under the Rs 25,938 crore Production Linked Incentive (PLI) scheme tailored for the automobile and auto components sector, as confirmed by a senior official.

Tata Motors has put forward a claim for incentives totaling approximately Rs 142.13 crore based on established sales figures for FY 2023-24.

The eligible sales of Advanced Automotive Technology (AAT) products from Tata Motors, valued at Rs 1,380.24 crore, encompass the Tiago EV, Starbus EV, and the small cargo vehicle Ace EV.

In a similar vein, M&M has lodged an incentive claim of Rs 104.08 crore rooted in determined incremental sales of AAT products, which amount to Rs 800.59 crore for FY 2023-24, with a cumulative investment of Rs 978.30 crore. The eligible sales from their e3W models include the Treo, Treo Zor, and Zor Grand, generating a total turnover of Rs 836.02 crore.

The combined incentive claims from Tata Motors and M&M reach approximately Rs 246 crore, which were evaluated and recommended for approval by the Project Management Agency (PMA). These claims have now received clearance from the Ministry of Heavy Industries (MHI), as stated by the official.

Minister for Heavy Industries H. D. Kumaraswamy has voiced his contentment with the advancements made by automotive original equipment manufacturers (OEMs) towards achieving localized production capabilities.

He also extended congratulations to Tata Motors and M&M for their development efforts and expressed hope that additional applicants would leverage the PLI scheme to amplify investments and the production of environmentally friendly green vehicles.

The aim of the scheme is to bolster India’s manufacturing prowess in AAT products, tackle cost disadvantages, and establish a robust supply chain.

The Union Cabinet sanctioned the PLI-Auto Scheme in September 2021, allocating a budget of Rs 25,938 crore for a span of five years (FY2022-23 to FY2026-27). The distribution of incentives is slated from FY 2024-25 to FY 2028-29.

The PLI-Auto Scheme is designed to enhance the manufacturing of AAT products and encourage deep localization with the establishment of both domestic and global supply chains.

Under this initiative, incentives ranging from 13-18 percent are available for components related to electric vehicles and hydrogen fuel cells, while other AAT components are eligible for incentives of 8 percent and 13 percent.

As of September 2024, the scheme has already facilitated an investment of Rs 20,715 crore, resulting in incremental sales of Rs 10,472 crore, according to official statistics.

This scheme mandates a minimum of 50 percent domestic value addition as a prerequisite for both domestic and export sales.

Approved applicants must submit a Domestic Value Addition certificate, duly cost-audited by an external auditor and self-certified by the authorized representative of the approved applicant through the PLI Auto Portal in the specified format.