The purpose of Prime Minister Narendra Modi's Production-Linked Incentive (PLI) scheme is to promote electronics manufacturing in India and attract foreign investment. Under this scheme, the government had promised a subsidy of Rs 410 billion. However, some funds are left due to companies not being able to meet the set production targets. Now Apple iPhone maker companies Foxconn and Dixon Technologies have demanded PLI subsidy from the government.
Foxconn produced iPhones worth about Rs 300 billion in the financial year 2022-23, which is much more than the target of Rs 200 billion set under the scheme. At the same time, Dixon made smartphones worth Rs 80 billion in the financial year 2023-24, while its target was Rs 60 billion.
Both these companies claim that considering their better performance, they are eligible for the remaining funds. According to ET, if the government releases funds, Foxconn may get a subsidy of Rs 6 billion and Dixon may get a subsidy of Rs 1 billion. At present, Foxconn, Dixon and the Ministry have not given any information on this matter.
It is believed that the government is reviewing the subsidy requests of these two companies. In the case of Dixon, the government is also investigating whether Dixon made new investment for Xiaomi's smartphone production or just shifted the machines of the old plant. The decline in Xiaomi's market share has made the situation more difficult.
Foxconn and other companies have invested $ 14 billion (about Rs 1.2 lakh crore) to move away from China to make iPhones in India. South Korea's Samsung Electronics Company has also planned to increase exports.
Prime Minister Narendra Modi's production-linked subsidy scheme set annual value-based limits for global and local electronics firms, capped at certain levels. An approach also seen in this project was that if some companies do not produce up to the target, then their remaining subsidy should be distributed among those companies which have produced above the target.
