PLI Schemes Reach 28% of Jobs Target by March 2026, NITI Aayog Assessment Finds

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The NDA government's flagship production-linked incentive (PLI) scheme has generated 8.49 lakh jobs by March 2026, or 28% of its target of 30.18 lakh, according to a NITI Aayog assessment prepared in partnership with the Indian Institute of Management Ahmedabad. The 14 schemes under the PLI framework, launched in March 2020, achieved 76% of their investment target and 64% of their production target over the same period, the report showed.

Employment outcomes vary sharply across sectors. The food products PLI scheme created 3.29 lakh jobs, the highest among the sectors, followed by large-scale electronic manufacturing with 1.69 lakh jobs and pharmaceutical drugs with 1.14 lakh jobs. Automobiles and auto components generated 67,820 jobs against a five-year target of 1.48 lakh, while white goods created 52,703 jobs. Telecom and networking created 33,610 jobs, and textiles supported 33,427 jobs. Solar PV modules, speciality steel, bulk drugs, medical devices, IT hardware, drones and drone components, and battery manufacturing each generated fewer than 15,000 jobs.

Cumulative incentive disbursements stood at 18.51% of the total outlay of ₹1.91 lakh crore as of March 2026. Nine schemes, including those for bulk drugs, automobiles and textiles, had disbursed less than 10% of their respective outlays, while schemes for drones and drone components, large-scale electronics and food products saw disbursements ranging from 25% to 77%. The report noted that 578 of the aggregate 996 months of implementation had been completed, leaving 42% of the period remaining.

What is the Production-Linked Incentive scheme?

The scheme for mobile manufacturing and specified electronic components was notified earlier in April 2020. The scheme offers financial incentives to manufacturers based on incremental sales from products manufactured in domestic units. The Department for Promotion of Industry and Internal Trade (DPIIT) is the nodal coordinating department for the PLI scheme. Individual ministries implement the sector-specific PLI schemes. The PLI scheme followed earlier initiatives such as the Phased Manufacturing Programme for electronics. The Modified Special Incentive Package Scheme (M-SIPS) was launched in 2012 and offered capital subsidies.

Why have jobs lagged behind investment and production?

The assessment said the divergence between cumulative employment and the other two parameters can be understood in the context of the gestation period of manufacturing investments. Investment generally takes place before facilities become fully operational; production then ramps up as capacity is commissioned and utilisation increases, while employment can evolve further as operations reach commercial scale. The report also noted that capital-intensive sectors may generate substantial investment without a proportionate increase in employment, and technology-intensive sectors may require a longer gestation period before production and export outcomes become visible.

What has the assessment recommended?

The report hinted that stringent targets for disbursement of incentives could be among the reasons for the weaker take-off of a few schemes. It said that more stringent targets, especially in sectors with long gestation periods and demand uncertainty due to international trade dynamics and changing geopolitical circumstances, will lead to lower adoption of the PLI scheme. The report recommended the participation of industry in designing sector-specific policies and suggested modification of the scheme to include demand-side support alongside the current supply-driven framework.