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PLI Scheme: For Telecom Boost to Make India a Global Manufacturing Hub

The Cellular Operators Association of India (COAI), which represents service providers and equipment vendors, said that the production-linked incentive (PLI) scheme would boost local manufacturing, exports and also create employment opportunities. The government’s plan to incentivize the production of telecom gear and networking hardware would assist establish the local manufacturing ecosystem of these products, encourage research and development, attract large investments and enhance small enterprises, industry executives said.

“India is already the second-largest telecom market globally and this will go a long way in making the country a global hub for telecom innovation,” stated SP Kochhar, director general, COAI.

Finnish gear maker Nokia through its India handle said the guidelines were a boosting initiative by the government towards making India a worldwide manufacturing hub. “Nokia is committed to this vision with our Chennai factory that manufactures telecom equipment from 2G to 5G-making for India and the world.”

The Telecom Equipment Manufacturers’ Association (TEMA) which represents national telecom firms lauded the separate fiscal outlay of Rs 1000 crore earmarked for MSMEs.

“TEMA is particularly happy that threshold limits for investment have been made quite reasonable at Rs 10 crores for MSME and Rs 100 crores for non MSMEs. DoT is complimented on a very out of box initiative to reserve three applicants in each category only for domestic companies,” commented NK Goyal, chairman, TEMA.

Sunil Vachani, executive chairman, Dixon Technologies stated, "We have formulated a plan to invest in manufacturing consumer premise equipment, switches, and routers. Dixon has also announced a joint venture with Bharti Enterprises to manufacture telecom gear in India."

“With the already reduced income-tax rate for domestic manufacturing companies, the announcement of the PLI scheme will make India a lot more manufacturing friendly destination,” stated Ritesh Kumar, Partner, IndusLaw.

Kunal Chaudhary, Partner, EY India stated, "With a qualification criterion of global manufacturing turnover of INR 250 crores and INR 10,000 crores for Domestic and Global Companies respectively, 15% weightage to R&D expense and incentive to be given only to a maximum of 10 non-MSME companies, it would be interesting to see how the industry works to meet these criteria."

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