Production Linked Incentive (PLI) scheme for drones and drone components in India

PLI scheme for Drone

Objective

The objective of this scheme is to incentivise manufacturing of drones and drone components in India so as to make them self-sustaining and globally competitive.

Eligibility

 All manufacturers of drones in India shall be eligible for this scheme subject to compliance with other requirements specified herein.

All manufacturers of the following drone components shall be eligible, subject to compliance with other requirements specified herein: 6 THE GAZETTE OF INDIA : EXTRAORDINARY

 a) Airframe, propulsion systems (engine and electric), power systems, batteries and associated components, launch and recovery systems;

 b) Inertial Measurement Unit, Inertial Navigation System, flight control module, ground control station and associated components;

 c) Communications systems (radio frequency, transponders, satellite-based etc.);

d) Cameras, sensors, spraying systems and related payload etc.;

e) ‘Detect and Avoid’ system, emergency recovery system, trackers etc. and other components critical for safety and security.

The list of eligible drones and drone components may be modified by the Central Government from time to time.

All manufacturers of drones and drone components whose annual sales turnover is above the following threshold shall be eligible for claiming PLI:

Minimum annual sales turnover for claiming PLI
Indian MSME and startupsIndian Non-MSME
Drone (INR Cr)Component (INR Cr)Drone (INR Cr)Component (INR Cr)
20.5 41

Computation of the incentive

  1. Eligible sales turnover is defined as the total sales turnover achieved in a financial year (net of GST) from the sale of drones and drone components as stated in such manufacturer’s GST returns.
  2. Eligible purchase cost is defined as the total cost (net of GST) incurred in a financial year for purchase of drones and drone components as stated in such manufacturer’s GST returns.
  3. Eligible value addition in India in a financial year shall be eligible sales turnover minus the eligible purchase cost as defined above.
  4. For ample clarity, developers of software for drones and drone components are also eligible for the PLI, subject to the eligibility norms and guidelines of this scheme.
  5. The PLI rate applicable to the eligible value addition in India shall be 20% for the entire tenure of the scheme.
Illustrative PLI calculation for a manufacturer (for sample year FY 2021-22)
Claim yearSales – Net of GST (INR cr)Purchase – Net of GST (INR cr)Eligible value addition in India (INR cr)PLI rate for value addition (%)Applicable PLI (INR cr)
FY 21-2210060 4020%8
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