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Government approves 27 manufacturers for IT manufacturing in India

The government has approved the applications of 27 IT manufacturing companies for its Production Linked Incentive (PLI) scheme in India, including the likes of Dell, HP, Acer, Asus and Lenovo.

On November 18, the government approved the applications of 27 information technology (IT) hardware manufacturers under its Production Linked Incentive (PLI) Scheme for IT hardware 2.0. Under this PLI scheme, the companies assembling laptops, tablets, all-in-one PCs, and ultra-small form factor (USFF) computers would receive an incentive of 3%, 2%, 1%, and 1% on net incremental sales of manufactured goods (over the base year 2022-23) respectively.

In September this year, IT Minister Ashwini Vaishnav revealed that the government has received 38 applications for the scheme. This update confirms that 27 of these applications have been accepted by the government with companies like Dell, HP, Acer, Asus, and Lenovo making up the ranks of the accepted companies. Vaishnaw has confirmed that 23 of the 27 accepted applicants are ready to start manufacturing from day zero (the day the scheme comes into effect).

Some context:

In August this year, the Ministry of Commerce and Industry notified that the import of laptops, tablets, all-in-one personal computers, and ultra-small form factor computers and servers will be restricted starting November 1, 2023. Soon after, multiple companies including Dell, HP, Asus, Acer, and Lenovo signed up for the PLI Scheme for IT hardware 2.0. As November 1 came and went, there has been no official confirmation from the government on the implementation of this import ban, but reports suggest that the ban has been called off.

What does the PLI Scheme entail?

By participating in this scheme, companies would receive financial support from the government for manufacturing IT hardware in India. Further, they would also receive additional financial benefits for incremental investments such as exclusively producing a certain component of a product in the country. Financial benefits have been capped at ₹ 4,500 Crore for Global companies like Dell and HP and the money will be distributed over a period of six years, going from Rs. 321 crore in year 1 to Rs. 6,118  crore in year 6.

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