Team Siliconindia

• Indian government reopens Production-Linked Incentive (PLI) scheme applications for textiles to help industry face US 50 percent tariff impact
• PLI scheme focuses on man-made fibre (MMF) apparel, fabrics, and technical textiles, excluding cotton garment production
• Scheme launched in 2021 with Rs 10,683 crore budget; aims to boost manufacturing, with 80 applicants sanctioned so far and Rs 500 crore incentives planned this fiscal year

Since the Indian textile and apparel sector is in a tough situation after the US administration levied a 50 percent tariff, the Indian government has chosen to issue new applications for the production-linked incentive (PLI) scheme. While the scheme will assist the textile industry to compete in the US market, the garment sector will not experience much from the announcement as cotton garment production is not covered under the scheme.

Union Textiles Ministry said that it would reopen the PLI scheme for the textiles industry. In a release, the ministry explained that in response to representations from the industry stakeholders, the ministry has given a decision to reopen the portal of PLI scheme for the issue of fresh applications from interested applicants for MMF apparel, MMF fabrics, and technical textile products. The portal will be open until August 31 this year.

The move comes when the US has slapped 50 percent tariffs on Indian exports. Sectors that are labour-intensive like textiles are likely to be among the hardest hit.

Also Read: Indian Electronics Exports Face $30 Billion Risk from US Tariffs

Following the ministry's announcement, all terms and conditions previously notified through the respective scheme guidelines will remain applicable for the fresh applications. The ministry appealed to all interested companies to avail themselves of this opportunity and make their applications within the given timeframe.

The Centre sanctioned the PLI scheme for textiles in September 2021 with a budgetary spend of Rs 10,683 crore ($1,220 million) for a five-year tenure to enhance the manufacture of man-made fibre (MMF) garments and fabrics, among others.

The government, so far, has sanctioned 80 applicants under the scheme. During the current fiscal year, it plans to disburse Rs 500 crore ($57.09 million) as incentives in the PLI scheme. The scheme received a lukewarm response, with just 64 companies announcing investments worth Rs 6,000 crore ($685 million). But many investors did not follow through because of multiple issues.