37 firms apply for telecom PLI, Samsung gives it a miss

By: |
July 06, 2021 12:40 AM

Samsung is understood to not have applied because of lack of opportunities in the 5G equipment market for it. Reliance Jio is the only operator which has deployed Samsung radio network for 4G, but for 5G, the former has indicated it will utilise a homegrown solution and has so far not committed to Samsung.

The scheme is expected to offset huge imports of telecom equipment worth more than Rs 50,000 crore and reinforce it with made-in-India products both for domestic markets and exports.The scheme is expected to offset huge imports of telecom equipment worth more than Rs 50,000 crore and reinforce it with made-in-India products both for domestic markets and exports.

Thirty-seven global and local firms, including Nokia, Jabil, Cisco, Flex and Foxconn, have applied for the production-linked incentive (PLI) scheme for telecom equipment manufacturing. Samsung Electronics, however has not applied. The company had earlier not applied for the IT hardware scheme for tablets and laptops either.

Samsung is understood to not have applied because of lack of opportunities in the 5G equipment market for it. Reliance Jio is the only operator which has deployed Samsung radio network for 4G, but for 5G, the former has indicated it will utilise a homegrown solution and has so far not committed to Samsung.

The department of telecommunications (DoT) will select companies from the 37 applicants based on competitive investment. Higher the investment commitment, higher the chances of the company being selected.

The DoT will grant approvals to 10 eligible applications each in MSME and non-MSME categories. In the non-MSME category, at least three of the 10 will be eligible domestic companies. The applications will be shortlisted from highest to lowest on the basis of committed cumulative incremental investment during the period of the scheme.

The scheme, with an outlay of Rs 12,195 crore, offers incentives in the range of 4% to 7% for different categories and years. For MSMEs, a 1% higher incentive is proposed in year 1, year 2 and year 3. Financial year 2019-20 will be treated as the base year for computation of cumulative incremental sales of manufactured goods net of taxes.

The minimum investment threshold for MSMEs has been kept at Rs 10 crore and for others at Rs 100 crore.

It is estimated that full utilisation of the scheme funds is likely to lead to incremental production of around Rs 2.4 lakh crore with exports of around Rs 2 lakh crore over five years. It is also expected that the scheme will bring investment of around Rs 3,000 crore and generate huge direct and indirect employment.

Telecom equipment that would be covered under the scheme includes core transmission equipment, 4G/5G next-generation radio access network and wireless equipment, access and customer premises equipment (CPE), Internet of things (IoT) access devices, other wireless equipment and enterprise equipment like switches and routers.

The scheme is expected to offset huge imports of telecom equipment worth more than Rs 50,000 crore and reinforce it with made-in-India products both for domestic markets and exports.

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