Extend PLI scheme to more sectors to boost manufacturing: ASSOCHAM

New Delhi, Dec 16 (KNN) With the Union finance minister Nirmala Sitharaman all set to present the union budget for FY24 on February 1, 2022, the Industry body Assocham has recommended for an extension of the production-linked incentive (PLI) schemes to more sectors in the upcoming union budget.

Speaking to the media on Thursday, Sumant Singh, President, Assocham said that, on the backdrop of greater demand for incentives by manufacturers in some sectors compared to the allocated amount, government may consider allocating more fund some of the existing PLI schemes including that for the solar modules.

Singh also recommended for a recommended reallocation of funds from the schemes which have witnessed lesser takers to those where the demand is higher.

“The way the PLI schemes are configured, there are clearly more applicants that are coming in then there is money to be allocated, not in all sectors but certainly in some sectors. So one of the things is that the government reallocate funds between the PLI areas where, in one PLI scheme the full funds were not allocated because there wasn’t sufficient demand, it can be allocated to other PLIs," he said.

Addressing a question regarding incentive scheme for solar modules, Sinha, said that although, Centre has come up with the second tranche of PLI for solar modules, the demand would be much higher than the allocated amount.

In September, the union cabinet had approved the second tranche of PLI scheme worth Rs 19,500 crore for domestic manufacture of solar photovoltaic (PV) modules.

Among other pre-budget recommendations, the industry body said the government should increase the exemption limit for income tax to at least Rs 5 lakh so that more disposable income is left in the hands of consumers and the economy gets a consumption boost and further leg-up in the recovery. Without accounting for rebates, the present exemption limit is Rs 2.5 lakh for the assesses.

“The government must respond to the proactive steps other nations are doing to support the production of green hydrogen as India strives to become a major energy producer. Attention should be given to sustainable and green industries to promote job growth and a green economy. Economy security bigger than manufacturing security," he said.

Advancing the green economy, achieving energy independence, making investments in green industries, and reducing the use of fossil fuels are all steps for self-sufficiency.

“Boosting consumption by leaving more money in the hands of the consumers, is a low hanging fruit for a further recovery in economic growth, "said Deepak Sood, Secretary General, Assocham.

The chamber also noted that along with the consumption, the other path to a sustainable growth would be further promoting investment. In this direction, Assocham has suggested the 15 per cent corporate tax rate for new investments in manufacturing can be extended to all sectors, including services.

Suggesting another relief measure, it said the interest for late payment of the GST should be reduced to 12 per cent from 18 per cent. (KNN Bureau)