According to the recent report by ICRA the annual capex from the PLI schemes is expected to cross Rs 1 trillion from FY24 and may peak out at Rs 1.7 trillion in FY26 while it is expected not cross Rs 0.4 trillion mark in current fiscal.
Similarly contribution of capex from the PLI schemes of the total capex is expected to remain in the range of 5-10% in current fiscal while it is likely to touch the 25% mark in FY24 and 40% in FY26.
“Based on our calculations, the annual CAPEX from the PLI schemes are expected to cross Rs 1 trn from FY24 and may peak out at Rs 1.7 trn in FY26. Hence, FY24 could be an inflexion point for a surge in India’s manufacturing CAPEX, ” said Rohit Ahuja<\/a>, Head of Research and Outreach, ICRA.
Government is contemplating launching PLI schemes for a few more sectors to ensure CAPEX continues to remain elevated beyond FY26.
According to the report in some of the sectors such as mobile phones\/electronics, engineering goods, food products, etc, wherein production has started over FY22 or H1 FY23, the impact is visible in the surge in export data for these sectors. These can be primarily attributed to PLI schemes for these sectors.
Semiconductor and ACC batteries form 70% of the major pending capex deployment. The Indian semiconductor and electronics sector is expected to grow at a CAGR of 30-35% for the next five years. Further, regulations by the US to limit exports of semiconductor and chip-making equipment to China will benefit India in the future. Five applicants under the semiconductor and display fabrication PLI scheme<\/a> are expected to manufacture 1.2 lakh wafers per month.
The Government is also contemplating launching PLI schemes for a few more sectors, containers, electrolyser, power transmission equipment, etc to ensure CAPEX continues to remain elevated beyond FY26, ICRA said.
“However, in the wake of rising input costs, and unfavourable economic conditions, execution delays in certain sectors could be a concern, \" said Ahuja.
<\/body>","next_sibling":[{"msid":95752544,"title":"Twitter job cuts a concern as new EU rules kick in, EU justice head says","entity_type":"ARTICLE","link":"\/news\/twitter-job-cuts-a-concern-as-new-eu-rules-kick-in-eu-justice-head-says\/95752544","category_name":null,"category_name_seo":"telecomnews"}],"related_content":[],"msid":95752614,"entity_type":"ARTICLE","title":"PLI capex to cross Rs 1 trn from FY24: ICRA","synopsis":" Bulk of the CAPEX that companies have to put will be concentrated between FY24 to FY26 as most of the major sectors start manufacturing activities from FY24 onwards.","titleseo":"telecomnews\/pli-capex-to-cross-rs-1-trn-from-fy24-icra","status":"ACTIVE","authors":[{"author_name":"Alekh Shah","author_link":"\/author\/479258279\/alekh-shah","author_image":"https:\/\/etimg.etb2bimg.com\/authorthumb\/479258279.cms?width=100&height=100&hostid=268","author_additional":{"thumbsize":true,"msid":479258279,"author_name":"Alekh Shah","author_seo_name":"alekh-shah","designation":"Correspondent","agency":false}}],"analytics":{"comments":0,"views":201,"shares":0,"engagementtimems":1005000},"Alttitle":{"minfo":""},"artag":"ETCFO","artdate":"2022-11-25 07:46:40","lastupd":"2022-11-25 07:47:29","breadcrumbTags":["pli scheme","capex","icra","rohit ahuja","production linked incentive","cfo india","capital expenditure","cfo news","policy"],"secinfo":{"seolocation":"telecomnews\/pli-capex-to-cross-rs-1-trn-from-fy24-icra"}}" data-news_link="//www.iser-br.com/news/pli-capex-to-cross-rs-1-trn-from-fy24-icra/95752614">