The Union Ministry of Textiles has announced that it will accept online applications under the Production Linked Scheme (PLI) for Textiles beginning January 1, 2022.

The application can be submitted through PLI portal https://pli.texmin.gov.in/mainapp/Default. The application window will remain open from January 1, 2022 to January 31, 2022.

In September this year, the Union Cabinet approved the Rs.10683 crore Production Linked Incentive (PLI) Scheme for Textiles to promote production of man-made fibre (MMF) apparel & fabrics and technical textiles products in the country

The scheme aims to enhance India’s manufacturing capabilities by increasing investment and production in the textile sector, especially in the MMF segment and technical textiles under greenfield and brownfield investments.

The government also hopes that incentives offered under the PLI scheme will create a select group of world-class companies in the MMF and technical textile segments, which have the potential to grow, both in size and scale, using cutting-edge technology and thereby penetrating global value chains. India is currently a laggard in MMF textile trade due to high raw material costs, high tariff barriers and cheap imports from neighbouring countries.

Scheme Guidelines

According to the guideline released by the Textile Ministry, the scheme will operational from September 24, 2021 (date of notification) to March 31, 2030 and the incentive will be payable for five years.

The participants are eligible to apply for other schemes of the Central and State governments. Foreign (non-resident) investment in the participant’s company should be in compliance with the norms of the consolidated FDI Policy 2020.

Under the proposed guidelines, the participating companies will be paid scheme incentives if they achieve a combination threshold for turnover and minimum investment. The textile companies will be given two year gestation period to companies from FY23 to FY24 to set up activities qualifying for incentives that will flow from third year (performance year). The first performance year is 2024-2025 and the units have 2022-2024 to invest and start operations.

The participating companies are expected to establish a separate company and invest between Rs. 100-300 crore for manufacturing notified products in the government’s incentive list.

The rate of incentive offered under the scheme will be 11% of the turnover in the first performance year and will culminate at 7% at the end of fifth performance year.

An Empowered Group of Secretaries (EGoS) will monitor the progress of this PLI scheme by undertaking periodic review of the outgo under the Scheme.

Also Read: Explained: The Rs 10,683 Crore PLI Scheme For Textile Sector In India