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auto | IST

Auto PLI scheme: Major automakers concerned over conventional vehicles being left out

A day before the Union Cabinet takes up the production linked incentives (PLI) scheme for the auto sector, major automobile manufacturers have sought clarity about the framework for allocation of funds and some have expressed concerns about conventional internal combustion vehicles and CNG vehicles being left out.

A day before the Union Cabinet takes up the production linked incentives (PLI) scheme for the automobile sector on September 15, major vehicle manufacturers have sought clarity on the framework for allocation of funds while a few have expressed concerns over conventional internal combustion vehicles and CNG vehicles being left out of the scheme.
The auto PLI scheme, which would only support manufacturers of hydrogen fuel cell and electric vehicles (EVs), has left the conventional vehicle manufacturers concerned.
However, what comes as a bigger surprise is that CNG vehicles have been left out of the vehicle manufacturing scheme and the component manufacturing scheme as well.
The PLI scheme for components covers components for flex-fuel engines, hydrogen fuel cells, EVs, hybrids, petrol, diesel and vehicle safety products but not CNG. Therefore, CNG makers are questioning if there has been a U-turn on the part of the government as diesel components are being included but not CNG despite the push towards cleaner fuels. 
The government also has a roadmap to have 10,000 CNG stations in India in the next five years. So, what happens to that intent is what the industry is asking.
It seems that companies that are making investments, component manufacturers who are making investments in EVs, hydrogen fuel cell and greater safety features, will benefit from the scheme but those who have a large portfolio of internal combustion engine or of internal combustion components are likely to be left out as a result.
Watch the accompanying video of CNBC-TV18’s Parikshit Luthra for more details.