Drone PLI Scheme: Civil Aviation Ministry Approves Operational Guidelines For Rs 120 crore Incentive Scheme To Boost Domestic Drone Manufacturing

The Civil Aviation Ministry has approved the PLI (performance linked incentive) scheme with an outlay of Rs 120 crore and the scheme is to be implemented during the 2022-23 to 2024-25 period.

In a communication dated November 29, the ministry said the guidelines have been finalised after consultations with stakeholders, including industry representatives.

The PLI will be extended only to companies engaged in the manufacturing of drones and drone components in India.

The total PLI per manufacturer is capped at Rs 30 crore which is 25 per cent of the total financial outlay of Rs 120 crore.

Indian MSMEs and startups manufacturing drones and having annual sales turnover of Rs 2 crore will be eligible for the scheme. In the case of drone component makers, the eligibility threshold will be Rs 0.5 crore.

For Indian non-MSMEs that are into making drones, the annual sales turnover requirement will be Rs 4 crore for claiming the PLIs. The minimum level will be Rs 1 crore in the case of non-MSME drone component makers, as per the ministry.

Subject to the norms, developers of software for drones and drone components will also be eligible for PLI.

”Excess incentive paid to any applicant (due to any reason like sales return in the subsequent year or some other reason) will be adjusted in the incentives payable in the next year(s).

”If there are no incentives payable in the next year(s), the applicant has to return the incentive along with interest calculated at 3 years SBI MCLR prevailing on the date of disbursement, compounded annually, for the number of days of holding the excess incentive,” the ministry said.

The Project Management Agency (PMA) appointed by the ministry will appraise the applications.

A committee chaired by the civil aviation secretary will consider the applications as recommended by the PMA.

Further, an Empowered Group of Secretaries, chaired by the Cabinet Secretary, will monitor the scheme and take appropriate action to ensure that the expenditure is within the prescribed outlay as approved by the Union Cabinet.

In April this year, the Civil Aviation  announced that 14 firms have been selected under the Union government’s Rs 120 crore Production-Linked Incentive (PLI) Scheme for manufacturing of drone and drone components.

The selected firms include five drone manufacturers and nine drone component manufacturers.

The ministry invited applications from eligible manufacturers on 10th March 2022 and the last date for submission was 31st March 2022.

The PLI scheme aims to propel in to India a global drone hub by 2030

The Drone PLI scheme was notified on 30 September 2021, and the total incentive under the scheme totals Rs 120 crore spread over three financial years, which is nearly double the combined turnover of all domestic drone manufacturers in FY 2020-21.

(Inputs from PTI)