How to Register for Production Linked Incentive Scheme for Food Processing Industry (PLISFPI)
Production Linked Incentive Scheme – The Government of India constantly brings in new schemes for the FPI in India, and due to the rising price of raw produce, they do need it every year. Today, we are going to talk about the Production Linked Incentive Scheme that the government launched for the Food Processing Industry. Before we get into the knits and grits of the scheme, we would like to put it here that if you need any help in applying under this scheme, we at KPMG can help you get approval and maintain all documents even after getting approval. Now that we’ve put this through let’s get through the details of the scheme.
What is the scheme and who is eligible?
The scheme as the name suggests primarily targets the Food Processing Industry and the Government of India will provide a total financial outlay of INR 10900 Crores under this scheme over FY 2021-22 to FY 2026-27. The Ministry of Food Processing Industries (MoFPI) will implement the scheme. Food processing industries that meet a certain minimum stipulated sales criterion and are willing to spend a definite ‘minimum investment amount’ for expansion of their units are eligible for the scheme.
What are the Objectives of the Scheme?
The Government of India plans to attain four major objectives through this Production Linked Incentive Scheme, they are as follows:
1. GOI wants to promote large-scale manufacturers who can become global food manufacturing leaders.
2. It wants to generate employment opportunities for the rural sector (off-farming)
3. Wants to promote Indian brands in the global market, thereby creating a bigger network of exports from India.
4. Wants to ensure that farmers get more remuneration for their produce/crop thereby increasing their overall income.
Different Category of Applicants
There are 3 different categories for this scheme under which applicants can apply based on their eligibility criteria. The details of these three categories are as follows:
1. Category 1: Large Entities
The applicants who have a definite amount of sales can apply for incentives based on sales and incentive criteria and they can also apply under the 3rd category, i.e., the incentive for branding & marketing purposes abroad.
The product categories under which such large entities can apply for incentives are:
• Ready to Cook/ Ready to Eat (RTC/ RTE) including millet-based
foods
• Processed Fruits & Vegetables
• Marine Products
• Mozzarella Cheese
1. Category 2: SMEs
SMEs that are manufacturing innovative or organic food products can apply under this category for incentives based on sales of such items.
The product categories under which such SMEs can apply for incentives are:
● Ready to Cook/ Ready to Eat (RTC/ RTE) including millet-based
● Foods
● Processed Fruits & Vegetables
● Marine Products
● Mozzarella Cheese
● Eggs
● Poultry Meats & Egg Products
1. Category 3
Companies or individuals who want to apply for incentives solely for branding & marketing activities abroad can apply under this category.
Here’s the list of activities on which such applicants can get incentives for branding & marketing:
● In-store Branding
● Shelf Space Renting
● Listing Fee
● Electronic/ Social Media & Print Media
● Outdoor publicity
● Billboard
● Commercial advertisement on channels etc.
Eligibility & Evaluation On Sales and other criteria
Apart from the basic eligibility and category of applicants mentioned above, there are certain other criteria for this Production Linked Incentive Scheme, that are primarily based on sales apart from the 3rd Category.
ELIGIBILITY
Here are the details:
1. Category 1: Large Entities
As mentioned above there are four product categories under which large entities can apply for the scheme. Now, here are the minimum sale numbers and investment amounts for these categories.
• RTC/ RTE – Minimum Sales – INR 500 Crores, Minimum Investment – INR 100 Crores
• Processed Fruits & Vegetables – Minimum Sales – INR 250 Crores, Minimum Investment – INR 50 Crores
• Marine Products – Minimum Sales – INR 600 Crores, Minimum Investment – INR 75 Crores
• Mozzarella Cheese – Minimum Sales – INR 150 Crores, Minimum Investment – (10 Metric Ton Plant – INR 23 Crores)
1. Category 2: SMEs
Here are the eligibility criteria for applicants under category 2:
i. The applicant company must have the Udyog Aadhar/Udyami Registration.
ii. The company must have achieved annual sales of INR 1 Crore for the FY 2019-20 for each of the products it wants to claim incentive on.
iii. SMEs applying for organic products must be registered with APEDA for that particular product they seek incentive for.
1. Category 3
Here are the eligibility criteria for applicants under category 3:
i. Only those Indian brands are covered under this category that has products completely manufactured in India.
ii. Branding & Marketing to be undertaken either by Applicant
directly or through its subsidiary or any other Agency
EVALUATION
1. Category 1: Large Entities
There’s a total score of 100 from which the entities will receive a score based on the below-mentioned points and thus be selected accordingly.
Criteria Weightage (%) for the score:
Sales (Domestic & exports) of food products of the relevant segment in 2019-20 will be 33.3%
Export Sales out of (Sl. No 1) above 33.3%
Committed Investment* 33.3%
1. Category 2: SMEs
Selection will be based on the combined score of sales of products, investment, CAGR, the potential for export, innovativeness, scalability, etc.
1. Category 3
Selection of Applicants will be based on the combined score of sale of food products, CAGR, branding expenditure, recognition of the brand in India, exports, etc.
How can we help you?
Apart from the above-mentioned details, there are many other details of the scheme that include the annual incentive allocation for all categories and different product types, the official definition of terms mentioned in the PLI, inclusions/exclusions of products from each product category, and more.
If you want help in finding out your eligibility, your obligations, things needed to become eligible, tax liabilities, compliance, your estimated incentive, and of course for applying under this scheme, you can connect with us.
We will not only help you apply under the scheme but also help you maintain all compliances once you start operating as well.
central sector scheme production linked incentive scheme food processing industry (PLISFPI)
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