IIM Ahmedabad to Analyze Shortcomings of India's PLI Schemes
IIM-Ahmedabad to study why PLI schemes fell short, recommend course correction
Mint
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The Indian government has commissioned the Indian Institute of Management, Ahmedabad (IIM-A) to investigate the underperformance of its Production-Linked Incentive (PLI) schemes, which have attracted approximately ₹2.16 trillion (around $26 billion USD) in investments since 2020. The study aims to recommend corrective measures to enhance local manufacturing and address sector-specific challenges.
- 01IIM Ahmedabad will evaluate the effectiveness of 14 PLI schemes launched during the COVID-19 pandemic.
- 02Only about ₹28,748 crore (15%) of the ₹1.91 trillion allocated for incentives has been disbursed by December 2025.
- 03The study will assess the impact of PLI schemes on production growth, job creation, and India's global supply chain positioning.
- 04Sectors like mobile manufacturing have performed well, while capital-intensive sectors like battery production have struggled.
- 05The government plans to address uneven performance and potential restructuring of the PLI schemes.
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The Indian government has tasked the Indian Institute of Management, Ahmedabad (IIM-A) to investigate the shortcomings of its Production-Linked Incentive (PLI) schemes, which were designed to boost domestic manufacturing. Launched during the COVID-19 pandemic, these schemes have attracted ₹2.16 trillion (approximately $26 billion USD) in investments. However, as of December 2025, only ₹28,748 crore (about 15%) of the allocated ₹1.91 trillion for incentives has been disbursed. The study, conducted under the guidance of the federal think tank NITI Aayog, will evaluate the effectiveness of 14 PLI schemes, focusing on their impact on production growth, job creation, and India's position in global supply chains. Early indicators suggest uneven performance across sectors, with mobile phone manufacturing and food processing showing positive results, while capital-intensive sectors like battery production face significant challenges. The study aims to recommend necessary course corrections to enhance the effectiveness of these schemes.
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The study's findings could lead to improvements in local manufacturing capabilities, potentially increasing job opportunities and production in various sectors.
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