Make in India, Startup India and PLI Scheme Notes

Three programmes carry most of India's industrial policy of the last decade: Make in India, which asks the world to manufacture here; Startup India, which builds a support system for new enterprise; and the Production Linked Incentive scheme, which pays manufacturers for what they actually produce. Examinations ask them together because they share one department and one aim, raising the share of manufacturing in the economy and in employment. The facts that are asked are the launch dates, the ministries, the targets, the definitions and the sectors, and all of them are settled matters of record.

Make in India

Make in India was launched on 25 September 2014 as a national programme to turn India into a global centre for design and manufacturing. It is run by the Department for Promotion of Industry and Internal Trade (DPIIT) under the Ministry of Commerce and Industry, and its emblem is a striding lion made of cogwheels, which stands for manufacturing and strength. The declared target is to raise the share of manufacturing in gross domestic product to 25 per cent and to create jobs on a large scale; the original date of 2022 was later extended.

• The programme rests on four pillars: new processes, that is easier regulation and ease of doing business; new infrastructure, including industrial corridors and clusters; new sectors, opened to foreign direct investment; and a new mindset in which government acts as a facilitator rather than a regulator.
• It began with twenty-five focus sectors. The second phase, called Make in India 2.0, works on twenty-seven sectors, fifteen in manufacturing and twelve in services.
• Supporting measures include liberalised foreign direct investment, with most sectors placed on the automatic route; the Goods and Services Tax from 2017, which made one market of the country; the Insolvency and Bankruptcy Code; the single-window National Single Window System; the PM Gati Shakti master plan and the National Logistics Policy for cutting logistics costs.
• Related campaigns are Atmanirbhar Bharat, announced in 2020, and Vocal for Local, which ask for self-reliance through domestic manufacturing rather than for closing the economy.

Startup India

Startup India was announced in the Independence Day address of 2015 and its Action Plan was released on 16 January 2016, a date now observed as National Startup Day. It too is implemented by DPIIT. The Action Plan has nineteen action points grouped under three heads: simplification and handholding, funding support and incentives, and industry-academia partnership and incubation.

The Production Linked Incentive scheme

The PLI scheme pays a manufacturer an incentive calculated on the incremental sales of goods manufactured in India over a base year, for a fixed number of years. That is its distinguishing feature: it rewards output actually produced and sold, not the capital invested, so the money follows performance.

• The first PLI scheme was notified in 2020 for large-scale electronics manufacturing, aimed at mobile phones and specified electronic components.
• It was extended to fourteen sectors, with a total outlay of about Rs 1.97 lakh crore announced in the Union Budget for 2021-22.
• The fourteen sectors are mobile phones and electronic components, critical key starting materials and active pharmaceutical ingredients, medical devices, automobiles and auto components, pharmaceuticals, speciality steel, telecom and networking products, electronic and technology products, white goods such as air conditioners and LED lights, food products, textile products including man-made fibre and technical textiles, high-efficiency solar photovoltaic modules, advanced chemistry cell batteries, and drones and drone components.
• Each scheme is run by its own administrative ministry, so the PLI for pharmaceuticals is run by the Department of Pharmaceuticals and the PLI for textiles by the Ministry of Textiles, while the overall framework comes from NITI Aayog's recommendations and Cabinet approvals.

How the three fit together

• Make in India is the umbrella policy and the brand; Startup India works at the entry end, on new and small enterprises; PLI works at the scale end, on large manufacturing in chosen sectors.
• All three are coordinated by the Ministry of Commerce and Industry, with DPIIT as the nodal department for the first two.
• Their shared purpose is to lift manufacturing's share of output, reduce import dependence in electronics and pharmaceuticals, and add jobs outside agriculture.
• Criticism commonly cited in examinations is that manufacturing's share of GDP has not yet reached the target, that PLI benefits are concentrated in a few sectors, and that small firms find the compliance burden heavy.