Govt Eyes ₹4,000-Cr Auto PLI Payout This Fiscal; Bajaj Auto Gets First Incentive

The government expects to disburse around ₹4,000 crore under the Production-Linked Incentive (PLI) scheme for automobiles and auto components during the current financial year, according to an Economic Times (ET) report.

The incentives will be paid to eligible companies based on incremental sales achieved in FY26. The planned disbursal comes as the Centre continues to push domestic manufacturing and value addition in the automobile sector through the PLI programme.

Bajaj Auto has become the first company to receive incentives under the scheme this fiscal. Citing a senior government official, the publication reported that the Pune-based automaker received about ₹750 crore last week after its claims were settled.

Bajaj Auto First to Receive Incentive This Fiscal

According to the report, the incentive paid to Bajaj Auto is linked to incremental sales of around ₹6,000 crore achieved by the company under the scheme.

In August 2024, Bajaj Auto had announced that 13 of its vehicles were approved under the Auto PLI scheme. These included both two-wheelers and three-wheelers, with the company stating that they met the domestic value addition requirements prescribed under the programme.

The Auto PLI scheme rewards companies that meet targets related to incremental production, investment and domestic value addition. The government approved the scheme in September 2021 with a total outlay of ₹25,938 crore.

Budget Allocation Sees Sharp Increase

The Union Budget for FY27 has earmarked ₹5,939.87 crore for the Auto PLI scheme, nearly three times the ₹2,091.26 crore allocated in the previous financial year.

Last December, the Ministry of Heavy Industries estimated that companies covered under the scheme had generated sales worth ₹32,879 crore, reflecting growing participation from the sector.

Responding to a question in Parliament, Minister of State for Heavy Industries Bhupathiraju Srinivasa Varma said the government had disbursed ₹1,350.83 crore to five applicants under the scheme. With fresh claims now being processed, the Centre expects total payouts under the programme to reach around ₹4,000 crore during the current fiscal.