# NITI Aayog-IIMA review: PLI schemes have paid out 18.5% of their ₹1.91 lakh crore outlay

URL: https://upsc.help/current-affairs/2026-11-13/pli-niti-iima-midcourse-review/
Date: 13 November 2026 (2026-11-13)
Source: Indian Express, Page 17
UPSC papers: GS3
Publisher: upsc.help (Pratidin), free and open-source UPSC Civil Services current affairs. Not affiliated with UPSC. Every fact was checked against the source reports by a separate review before publishing.

**In one line:** A NITI Aayog-IIMA review finds India's PLI schemes have pulled in investment but lag on jobs, value addition and payouts.

Six years after the first Production Linked Incentive (PLI) schemes began, a mid-course assessment prepared by NITI Aayog with the Indian Institute of Management Ahmedabad (IIMA) has found that only ₹35,354 crore, or 18.51% of the total allocation of ₹1,91,049 crore across 14 schemes, had been disbursed by March 2026. The report was released on 12 November 2026; NITI Aayog Vice Chairman Ashok Kumar Lahiri called manufacturing an engine of employment, innovation and productivity-led growth. By March 2026, the schemes had drawn cumulative investment of ₹2.40 lakh crore (76% of the full-tenure target) and production of ₹22.66 lakh crore, with production and sales at 64% of target. They had created 8.49 lakh jobs, only 28% of the target of 30.18 lakh.

The report says nearly 70% of targeted segments are broadly on track. Large-scale electronics manufacturing, mainly mobile phones, stands out for growth in production, exports and jobs; telecom and pharmaceutical drugs also did well. In white goods such as air conditioners and LED lights, domestic value addition rose from about 20% in FY20 to 55% in FY25. The small drones scheme, with ₹120 crore, has disbursed about 77.5%. The auto and auto components scheme, with ₹25,938 crore allocated, had attracted ₹44,326 crore of investment. Advanced Chemistry Cell batteries and advanced electronic components remain at an early stage, and bulk drugs show mixed results.

The report flags dependence on imported high-value components, project delays and uneven exports and jobs. It notes that heavy investment in automated industries does not create proportionate employment, and that the telecom scheme does not mandate domestic value addition, so firms can import parts and still claim incentives. On MSMEs, it says direct benefits have been uneven and mostly indirect, and there is no consolidated count of MSME suppliers that gained. Because incentives are paid only after output targets are met, the low payout partly reflects design. The report recommends faster implementation, stronger domestic supply chains, closer engagement with industry, and pairing supply-side support with demand-side incentives for domestically made products.

## Prelims facts

- A NITI Aayog-IIM Ahmedabad assessment found 14 PLI schemes had disbursed ₹35,354 crore, 18.51% of their ₹1,91,049 crore outlay, by March 2026.
- PLI investment reached ₹2.40 lakh crore (76% of target), production ₹22.66 lakh crore, and jobs 8.49 lakh (28% of target).
- Large-scale electronics, telecom and pharmaceutical drugs did well; Advanced Chemistry Cell batteries remain at an early stage.
- Domestic value addition in white goods rose from about 20% in FY20 to 55% in FY25.
- The report recommends pairing supply-side incentives with demand-side support for domestically made products.

## Quick recall

- **Who prepared the November 2026 mid-course assessment of PLI schemes?** NITI Aayog with the Indian Institute of Management Ahmedabad.
- **Total PLI outlay across 14 schemes?** ₹1,91,049 crore (about ₹1.91 lakh crore).
- **PLI incentives disbursed by March 2026?** ₹35,354 crore, 18.51% of the outlay.
- **Cumulative PLI investment by March 2026?** ₹2.40 lakh crore, 76% of the full-tenure target.
- **Jobs created under PLI by March 2026?** 8.49 lakh, 28% of the target of 30.18 lakh.
- **Domestic value addition in white goods under PLI?** Rose from about 20% in FY20 to 55% in FY25.
- **Which PLI scheme had disbursed about 77.5% of its allocation?** Drones and drone components (₹120 crore allocation).
- **Which PLI scheme does not mandate domestic value addition, per the assessment?** Telecom and networking products.

## Prelims practice question

With reference to the Production Linked Incentive (PLI) schemes, consider the following statements:
1. Incentives are paid on incremental sales after firms meet investment and output thresholds.
2. By March 2026, more than half of the total PLI outlay had been disbursed.
3. Employment created under PLI by March 2026 was below one-third of the target.
Which of the statements given above are correct?

(a) 1 and 2 only
(b) 1 and 3 only
(c) 2 and 3 only
(d) 1, 2 and 3

Answer: (b) 1 and 3 only. Statement 1 is correct: PLI pays a share of incremental sales after targets are met. Statement 2 is wrong: only 18.51% had been disbursed. Statement 3 is correct: 8.49 lakh jobs is 28% of the 30.18 lakh target.

## UPSC previous-year questions this connects to

- UPSC Mains 2025, GS3: Discuss the rationale of the Production Linked Incentive (PLI) scheme. What are its achievements? In what way can the functioning and outcomes of the scheme be improved? (https://upsc.help/pyq/q006-rationale-production-linked-incentive-pli-scheme-achievements/)
  How to use this story in the answer: Use the NITI Aayog-IIMA mid-course numbers to show achievements in investment and electronics, gaps in jobs and value addition, and reforms suggested for the next phase.
- UPSC Mains 2023, GS3: Faster economic growth requires increased share of the manufacturing sector in GDP, particularly of MSMEs. Comment on the present policies of the Government in this regard. (https://upsc.help/pyq/q008-faster-economic-growth-requires-increased-share-manufacturing/)
  How to use this story in the answer: Cite PLI as the main manufacturing policy and note that its MSME gains are indirect and poorly tracked.
- UPSC Mains 2017, GS3: Account for the failure of manufacturing sector in achieving the goal of labour-intensive exports rather than capital-intensive exports. Suggest measures for more labour-intensive rather than capital-intensive exports. (https://upsc.help/pyq/q010-account-failure-manufacturing-sector-achieving-goal-labour-intensive/)
  How to use this story in the answer: Use PLI's 28% job achievement against 76% investment achievement to show manufacturing's capital-intensive tilt.

## Mains practice question

The mid-course assessment of the PLI schemes shows strong investment but weak job creation. Critically examine the performance of the PLI schemes and suggest changes for their next phase. (250 words)

### Model answer

The NITI Aayog-IIM Ahmedabad assessment released in November 2026 found that 14 PLI schemes with an outlay of ₹1,91,049 crore had paid out only 18.51% by March 2026, while drawing ₹2.40 lakh crore of investment.

## Achievements
- **Investment:** 76% of the full-tenure target reached.
- **Output:** production of ₹22.66 lakh crore; production and sales at 64% of target.
- **Champion sectors:** mobile phones under large-scale electronics; telecom; pharmaceutical drugs.
- **Localisation:** white goods domestic value addition up from about 20% in FY20 to 55% in FY25.
- **Fiscal prudence:** performance-linked payouts mean money flows only after results.

## Concerns
- **Jobs:** 8.49 lakh, only 28% of the 30.18 lakh target; automated industries add few jobs.
- **Import dependence:** high-value components still imported; telecom PLI has no value-addition mandate.
- **Laggards:** Advanced Chemistry Cell batteries at an early stage; bulk drugs mixed.
- **MSMEs:** benefits indirect; no consolidated count of MSME suppliers that gained.
- **Low payout:** 18.51% disbursement signals slow conversion of commitments into production.

## Way forward
- Tie incentives to domestic value addition and employment, not sales alone.
- Add demand-side incentives for domestically made products, as the report suggests.
- Build supplier development and technology support for MSMEs.
- Faster verification and resolution of sector bottlenecks.
- Track MSME graduation and exports in the next assessment.

## Conclusion
PLI has proven it can attract capital; its next phase must prove it can build deep supply chains and jobs.

## The basics

## Why this matters

India wants manufacturing to grow faster and create more jobs. The Production Linked Incentive (PLI) schemes are the Centre's biggest bet on that goal. A mid-course assessment by NITI Aayog and IIM Ahmedabad, released on 12 November 2026, is the most detailed public check yet on whether the bet is paying off.

## How a PLI scheme works

A Production Linked Incentive does not hand out money upfront. A firm first commits to invest and to raise output above a base year. The government then pays a percentage of the extra (incremental) sales, but only after targets are met and verified. That is why a low payout figure can mean either slow progress or a design that pays only for results.

## What the assessment found

Investment is closest to target, jobs furthest. The report says higher investment does not always bring proportionate employment, especially in capital-intensive, highly automated industries. That gap matters because job creation was one of the main political arguments for the schemes.

## Winners and laggards

Domestic value addition is the key test. Assembly that imports most components earns incentives but builds little local industry. The telecom scheme, for example, does not mandate it.

## The MSME question

PLI was not designed for MSMEs in supply chains. Benefits were expected to trickle down through suppliers of large anchor firms. The assessment says there is no consolidated count of MSME suppliers that benefited, and calls this a gap in evidence, not proof of failure.

## Sources

- https://superkalam.com/current-affairs/13-11-2026/6-years-on-pli-schemes-see-18-5-of-total-outlay-pg17-40ed1f5c-f57c-4f40-82dc-e83580ea4acb
- https://psuwatch.com/newsupdates/nearly-70-of-pli-sectors-on-track-investments-cross-rs-240-lakh-crore-niti-aayog
- https://aninews.in/news/business/pli-schemes-attract-rs-24-lakh-crore-investment-generate-rs-2266-lakh-crore-production-niti-aayog-report20261112185707/
- https://www.business-standard.com/industry/news/pli-schemes-boost-manufacturing-but-msme-gains-remain-largely-indirect-126111201644_1.html