The Telecom Equipment Manufacturers Association (TEMA) has called upon the government to make the Telecom PLI (Production Linked Incentive Scheme) complimentary and not to replicate it on the lines of Electronics PLI Scheme.
According to a press release, TEMA along with several other members have highlighted before the Department of Telecom (DoT) that the Telecom PLI scheme was primarily B2B, with limited numbers of service providers as customers, whereas the Electronics PLI was for B2C and had over 130 crore Indians as possible customers.
“Hence the Telecom PLI should be complementary and not exactly the same as that of Electronics PLI Scheme,” TEMA stated.
The organization also suggested that the government should include mandatory eligibility criteria, commitment and compliance on domestic Value Addition, exports, employment, and technology absorption as required conditions for a company to avail the benefits of the Telecom PLI.
Complimenting the Department of Telecom (DOT) for the proposed telecom PLI scheme, TEMA Chairman Emeritus Prof. NK Goyal informed that the association along with some other members requested that the incentive programme should be made available only for indigenously designed, developed, and manufactured products and not for products that are being assembled here.“
The Telecom PLI should, however, be available for domestic production that may be for domestic consumption or exports,” he said, adding that the PLI is not a substitute for Merchandise Exports from India Scheme (MEIS), which was available to all exporters whether existing or new. “The PLI on electronics on the other side is primarily on production and not related to exports.”
The MEIS, under the Foreign Trade Policy (FTP) 2015-20, intends to incentivize exports of goods manufactured or produced in the country. The incentives are for goods widely exported from India and industries producing or manufacturing such goods with a view to making exports competitive.
TEMA further pointed out that Telecom PLI is expected to address the disability factor for Indian manufacturing and the industry has asked for 5-10% of the incentive.
“While some members said that there should be no norm for value addition, TEMA supports the suggestion by several other members that we should avoid almost 100% import of components. Instead, Value Addition should be eligibility criteria,” Prof. Goyal said.
Clarifying on the points made by some members that electronics PLI was only for exports TEMA further stated that electronics PLI does not talk of exports as eligibility criteria or compliance. According to a statement issued by TEMA, the presentation on electronics PLI Scheme forecasts the exports of Rs 5.8 lakh crore over five years, and the electronics PLI scheme is applicable to production.