At least three local telecom gear comapanies to get performance linked incentives: DoT

CHENNAI:  The Department of Telecommunications (DoT) on Thursday issued operational guidelines for telecom gear companies looking to take advantage of the Union government’s Rs 12,195-crore performance linked incentive (PLI) scheme for the sector.

According to the DoT, at least three out of the ten eligible applications to be approved in the non-MSME category will have to be domestic entities. The registration process for the scheme will begin on Friday and remain open for 30 days till July 3.

The government expects the scheme to encourage production of telecom equipment worth Rs 2.44 lakh crore over a period of five years, create 40,000 indirect and direct jobs, and generate a tax revenue of about Rs 17,000 crore. Around Rs 3,000 crore is expected to be invested through the scheme.

“The scheme is open to both MSME and non-MSME companies including domestic and global companies. Also, manufacturers with products with Indian technology are encouraged to apply,” the DoT said.

Out of the Rs 12,195 crore allocated for the scheme, Rs 1,000 crore is for MSME firms.

According to the guidelines, investments made by successful applicants in India from April 1, 2021, up to financial year 2024-2025 shall be eligible for the scheme, subject to qualifying incremental annual thresholds.

The scheme becomes effective on April 1, 2021, and support under the scheme shall be provided for a period of five years to successful applicants—from FY22-26. 

Applicants will also have to satisfy minimum revenue criteria for eligibility and can decide to invest in one or multiple eligible products.

“The scheme stipulates a minimum investment threshold of Rs 10 crore for MSME and Rs 100 crore for non-MSME applicants.  Land and building costs will not be counted as investment. Eligibility shall be further subject to Incremental Sales of Manufactured Goods (covered under Scheme Target  Segments) over the base year (FY2019-20),” the DoT statement said.

The department will grant approvals to 10 eligible applications each in the MSME and non-MSME categories.