The PLI (production-linked incentives) often have a negative result as those using it complain of having net negative results in the medium term. Despite that, the chief economic advisor of SBI, Soumya Kanti Ghosh favours the extension of the scheme to the small businesses. According to them, the country can increase its GDP further by promoting domestic manufacturing. It will provide a lot of benefits to the country itself. India will also become independent from China in case of a lot of imports to a great extent.

Discussion Going Among The SBI House Economist Preferring Extension Of PLI To MSME

How Does The PLI Scheme Extension To Small Businesses Promote The GDP Growth?

The PLI Scheme must extend to MSMEs to promote the country’s growth. Soumya Kanti Ghosh presents different opinions on PLI schemes. The extension of the PLI scheme to small businesses is to be proposed. The budget may consider and implement it for growth. The criteria focus on extending the PLI to small businesses increasing the employment rates and exports. The idea of promoting domestic manufacturing rather than imports is great for the country’s growth. It will directly target the unemployment issue running in the country on a mass level.

Apart from that, it will also help in promoting the exports from the country. It can add up to USD 30 billion to India’s GDP. It will also strengthen the Indian rupee against other currencies. The lack of concentration on domestic manufacturing hampers around 16.5% growth of the country’s GDP. A lot of sectors can implement this scheme. The sectors like automobiles, food, speciality steel, pharmaceuticals, electronics, technology, textiles, and aviation can be covered under the PLI scheme.

India’s imports from China are increasing every year. In the previous year itself, the imports increased by 15%. However, if the imports decrease, our dependence on China will reduce as well. Reducing the dependence by 20% will increase the GDP by 12 billion dollars. On the other hand, if the dependence is reduced by 50%, it will increase the GDP by 30 billion USD. SBI house economists prefer the extension of PLI to small businesses. It will help in reducing our dependence on the other countries.

If India has to become a superpower, it has to increase its imports and domestic manufacturing. The government launched the initiatives a few years ago to promote Indian products. It helps in employing a lot of people. Apart from that, providing tax benefits will also contribute to the growth of small businesses increasing the country’s GDP.

Discover more from industrialfront

Subscribe to get the latest posts sent to your email.

Leave a comment

Your email address will not be published. Required fields are marked *