The Ministry of Heavy Industries presented data in the Lok Sabha revealing that 225 manufacturing units have been established across the country under the Production Linked Incentive (PLI) scheme for the automobile and auto component industry as of March 31, 2026. Maharashtra has emerged as the top state with 66 units, followed by Tamil Nadu with 38 units, while Haryana and Karnataka account for 35 units each. The scheme has attracted ₹44,326 crore in investment and generated 67,820 jobs since its launch.
What Is the PLI Scheme for Automobile and Auto Components?
The Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry, also called PLI Auto, was approved by the Union Cabinet on September 23, 2021, with a budgetary outlay of ₹25,938 crore. The scheme is administered by the Ministry of Heavy Industries (MHI) and runs for five years, from FY2022-23 to FY2026-27.
The PLI Auto scheme is part of the larger umbrella of PLI schemes launched by the Government of India in 2020 with a total incentive outlay of ₹1.91 lakh crore across 14 strategic sectors. These sectors include electronics manufacturing, pharmaceuticals, textiles, food processing, white goods, solar PV modules, and telecom, among others. The PLI framework marked a fundamental shift from traditional input-based subsidies to outcome-linked incentives, where financial support is tied directly to incremental sales of goods manufactured in India over a defined base year.
The core objective of the PLI Auto scheme is to boost domestic manufacturing of Advanced Automotive Technology (AAT) products, overcome cost disabilities faced by domestic manufacturers, create economies of scale, generate employment, and build a robust supply chain for high-value automotive components. It is designed to help Indian automobile manufacturers move up the value chain into higher value-added products and reduce dependence on imports for critical components.
State-wise Distribution of Manufacturing Units
The data presented in the Lok Sabha in response to questions by Members of Parliament provides a clear picture of how the PLI Auto scheme has taken root across Indian states. The scheme follows a pan-India approach, allowing approved applicants to set up manufacturing units anywhere in the country based on their business needs, without any special incentives tied to specific states.
| State | Number of Manufacturing Units |
|---|---|
| Maharashtra | 66 |
| Tamil Nadu | 38 |
| Haryana | 35 |
| Karnataka | 28 |
| Uttar Pradesh | 13 |
| Gujarat | 10 |
| Uttarakhand | 9 |
| Rajasthan | 7 |
| Madhya Pradesh | 6 |
| Telangana | 5 |
| Andhra Pradesh | 2 |
| Jharkhand | 2 |
| Assam | 1 |
| Kerala | 1 |
| Puducherry | 1 |
| Punjab | 1 |
| Total | 225 |
Maharashtra leads with 66 units, consolidating its position as India’s premier automotive manufacturing hub. The state already hosts major automobile plants including those of Tata Motors, Mahindra & Mahindra, Bajaj Auto, and several auto component manufacturers in and around Pune, Nashik, and the Mumbai Metropolitan Region.
Tamil Nadu, often called the “Detroit of India” with its robust automotive ecosystem in Chennai, Hosur, and Coimbatore, accounts for 38 units. The state is home to factories of Hyundai, Ford, Renault-Nissan, and a dense network of auto component suppliers.
Haryana and Karnataka follow with 35 units each. Haryana’s automotive belt around Gurugram and Manesar houses Maruti Suzuki, Hero MotoCorp, and numerous component manufacturers. Karnataka’s ecosystem, centred in Bengaluru, has evolved beyond traditional manufacturing to become a hub for electric vehicle innovation and advanced automotive technology.
Investment, Employment and Sales Impact
Beyond the state-wise unit count, the PLI Auto scheme has delivered measurable outcomes across several parameters as of March 31, 2026:
| Parameter | Cumulative Achievement |
|---|---|
| Total Investment | ₹44,326 crore |
| Employment Generated | 67,820 jobs |
| Incremental Sales Over Base Year (FY2019-20) | ₹52,414 crore |
| Incentive Disbursed by Government | ₹2,386.36 crore |
The investment attracted so far already exceeds the scheme’s budgetary outlay of ₹25,938 crore, indicating strong industry confidence. The government has disbursed ₹2,386.36 crore as performance-linked incentives to eligible beneficiaries that met the scheme’s production targets.
As of July 16, 2026, the Ministry of Heavy Industries reported that 18 applicants had received Domestic Value Addition (DVA) certificates covering 154 products or variants. This certification process is critical because only companies that meet the minimum DVA threshold qualify for incentive payments.
How the PLI Auto Scheme Works
The PLI Auto scheme is structured to encourage manufacturing of advanced technology products rather than traditional internal combustion engine components.
Two Components of the Scheme
The scheme is divided into two distinct parts:
Champion OEM Incentive Scheme: This is a sales value linked scheme applicable to Battery Electric Vehicles (BEVs) and Hydrogen Fuel Cell Vehicles across all segments, including two-wheelers, three-wheelers, passenger vehicles, commercial vehicles, tractors, and military vehicles. Companies approved under this category can claim incentives on the determined sales value of these advanced vehicles manufactured in India. In February 2022, the Ministry had approved 20 applicants under this category, including major names such as Tata Motors, Mahindra & Mahindra, Hyundai Motor India, Maruti Suzuki (through Suzuki Motor Gujarat), Ashok Leyland, Bajaj Auto, Hero MotoCorp, TVS Motor Company, and Ola Electric Technologies.
Component Champion Incentive Scheme: This is also a sales value linked scheme, but it applies to Advanced Automotive Technology (AAT) components of vehicles, completely knocked down (CKD) kits, semi knocked down (SKD) kits, and vehicle aggregates across all vehicle segments. The list of eligible AAT components is prescribed by the Ministry of Heavy Industries and can be amended periodically based on technological developments.
Analogy · Understanding PLI Incentives Expand analogy
The PLI scheme works like a cashback offer. Instead of giving a company a subsidy upfront to set up a factory, the government promises a cash reward on every unit sold beyond a certain baseline. If the company sells more than its previous year’s sales, it gets a percentage of the extra sales value as an incentive. This ensures the government only pays for actual performance, not promises.
Domestic Value Addition Requirement
A key feature of the scheme is the minimum 50% Domestic Value Addition (DVA) requirement. To qualify for incentives, applicants must ensure that at least half of the value of the manufactured product is added within India. This rule is designed to prevent mere assembly of imported components and to encourage genuine local manufacturing. The DVA certification process validates that products meet this threshold, with 18 applicants having received certificates covering 154 products as of July 2026.
Significance of the State-wise Data
The state-wise distribution of manufacturing units under the PLI Auto scheme reveals several important patterns about India’s automotive geography.
First, the data confirms that India’s automotive manufacturing remains concentrated in a few traditional hubs. The top four states Maharashtra, Tamil Nadu, Haryana, and Karnataka together account for 166 out of 225 units, or nearly 74% of all units established under the scheme. This reflects the existing industrial infrastructure, skilled labour availability, supplier ecosystems, and logistics connectivity that these states already possess.
Second, the scheme has enabled some geographic diversification. States like Uttar Pradesh (13 units), Gujarat (10 units), Uttarakhand (9 units), and Rajasthan (7 units) have attracted a meaningful number of units. Telangana has emerged with 5 units, reflecting the growth of its industrial corridors. Even smaller states and union territories such as Assam, Kerala, Puducherry, and Punjab have at least one manufacturing unit each, showing the scheme’s nationwide reach.
Third, the data underscores the strategic advantage of existing automotive clusters. Maharashtra’s dominance can be attributed to the Pune-Nashik-Aurangabad automotive belt, while Tamil Nadu’s Chennai-Bengaluru Industrial Corridor has long been a magnet for global auto manufacturers. Haryana’s Gurugram-Manesar belt benefits from its proximity to the national capital and established supplier networks.
India is currently the fourth largest automobile producer in the world, with the sector contributing about 2.3% to the country’s GDP and employing over 1.5 million people directly. The PLI Auto scheme is a key policy instrument aimed at strengthening this vital sector further, particularly as the global automotive industry transitions toward electric and hydrogen-based mobility.
Key Takeaways
- The PLI Auto scheme was approved by the Union Cabinet on September 23, 2021, with a budgetary outlay of ₹25,938 crore for five years (FY2022-23 to FY2026-27).
- A total of 225 manufacturing units have been established under the scheme as of March 31, 2026, with Maharashtra leading at 66 units.
- The scheme has attracted cumulative investments of ₹44,326 crore, generated 67,820 jobs, and recorded incremental sales of ₹52,414 crore over the base year.
- The government has disbursed ₹2,386.36 crore in incentives, and 18 applicants have received Domestic Value Addition certificates covering 154 products.
- The scheme has two components: the Champion OEM Incentive Scheme for Battery Electric Vehicles and Hydrogen Fuel Cell Vehicles, and the Component Champion Incentive Scheme for Advanced Automotive Technology components.
- Applicants must achieve a minimum 50% Domestic Value Addition to qualify for incentives under the scheme.
