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21/02/2022 - Economy

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September 21, 2022

Do you think that the Productive Linked Incentive scheme alone can induce investment in the Indian economy? Examine (200 Words)

Refer - Business Line

Enrich the answer from other sources, if the question demands.

 

5 comments
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IAS Parliament 4 days

KEY POINTS

·        Schemes such as PLI have been floated by the government to encourage industry to invest more in capital that will result in higher output which, in turn, will be rewarded with a cash-back of 4-6 per cent.

·        In FY21, which is the latest year for which this information is available, the biggest contributor was the household sector with a share of 39 per cent.

·        The other significant entity is the PSU (non-financial) with a share of around 10 per cent.

·        The dominant sector here is real estate, with a share of 26.5 per cent, followed by manufacturing with 14.3 per cent.

·        Investments here will be driven by the regulatory environment as telecom is one sector that has been embroiled in several controversies since the start of the last decade.

·        Therefore investment needs to go beyond the PLI which pertains to manufacturing to address challenges in terms of demand.

·        This can be accomplished with more spending, through higher incomes being spent after being generated, which in turn leads to the issue of job creation.

·        Also, we have to look at all sectors when providing incentives, and not just manufacturing. This can be a pointer for future policy decisions on investment.

 

yogendra pratap singh 8 days

Kindly evaluate

IAS Parliament 7 days

Try to post the correct answer. Keep Writing.

K. V. A 9 days

Pls review

IAS Parliament 8 days

Good attempt. Keep Writing.

PANDI SANTHOSH RAJA S 9 days

Kindly review

IAS Parliament 8 days

Try to elaborate more on various ways to induce investment. Keep Writing.

Sivasurya 9 days

Please review

IAS Parliament 8 days

Try to include more facts and arguments to support your statement, there are various ways to induce investment. Keep Writing.

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