PLI Scheme for Promoting Telecom & Networking Products

Introduction

This scheme is part of the larger Production Linked Incentive (PLI) initiative of the Government of India. The idea is simple:
👉 If companies manufacture more in India, they get financial incentives.
👉 This not only reduces imports but also strengthens the “Make in India” mission and creates a domestic value chain.

Specifically, this PLI scheme focuses on telecom and networking products—the backbone of digital connectivity.

• Type: Central Sector Scheme (funded entirely by the Union Government).
• Purpose: To create a robust domestic value chain in telecom & networking.
• Implementing Agency: Small Industries Development Bank of India (SIDBI).
• Tenure: Investment window from 2021 up to FY 2024-25.

Objective

The core aim is to:

• Encourage domestic manufacturing of telecom & networking products.
• Attract investments in critical segments like 5G, routers, and switches.
• Reduce dependence on imports and establish India as a global hub for telecom equipment.

Scope – Who can benefit?

• Support is given only to companies manufacturing in India.
• Eligible expenditure categories include:
  1. New plant, machinery, and equipment
  2. Research & Development (R&D)
  3. Transfer of Technology (ToT)
  4. Civil works (installation and erection of plants, machinery, etc.)

This ensures that not just production but also innovation and infrastructure get boosted.

Target Segments

The scheme covers a wide range of telecom and networking products:

• Core Transmission Equipment
• 4G/5G equipment (Next-generation Radio Access Networks & Wireless Equipment)
• Access & Customer Premises Equipment (CPE), IoT access devices, and wireless equipment
• Enterprise equipment: switches, routers
• Any other product as notified by Empowered Group of Secretaries (EGoS)

This means India is preparing itself not only for today’s telecom needs but also for future technologies like 5G and IoT.

Financial Incentives

• Tenure of incentive payment: Up to 5 years.
• Rate of incentive:
  • MSMEs: 7%–4% on incremental sales over the Base Year (FY 2019-20).
  • Other companies: 6%–4%.
• Additional incentive: +1% for products that are designed and manufactured in India (Design-led PLI).

So, if a company invests in R&D and creates indigenous designs, it gets more rewards.

Why is this scheme important?

• Strategic Independence: In telecom, dependence on foreign imports is risky, especially for sensitive equipment. This scheme promotes self-reliance.
• Boost to 5G rollout: India’s upcoming 5G infrastructure requires advanced equipment, and this scheme ensures domestic availability.
• Support to MSMEs: By giving them slightly higher incentives, the scheme encourages small players to innovate and participate in the telecom revolution.
• Job creation & exports: Local production leads to more jobs and makes India a potential exporter of telecom equipment.

Summary

In short, the PLI Scheme for Telecom & Networking Products is India’s attempt to:

• Build a domestic telecom ecosystem
• Support MSMEs and R&D
• Prepare for 5G and IoT future needs
• Strengthen Make in India + Atmanirbhar Bharat in the strategic telecom sector.