Samsung Strikes Gold In India's Manufacturing Drive With A $72.3M Production Incentive Payout

This story was first published on the Benzinga India portal.

The Indian government will give the South Korean tech giant, Samsung Electronics Co. Ltd SSNLF, a whopping $72.3 million, marking the largest payout under the production-linked incentive (PLI) scheme to boost domestic manufacturing, per a Mint report. Top government officials have reportedly greenlit this decision, and they expect to finalize it by month-end.

What Happened? In its first year, Samsung claimed incentives of around $100 million after raking in revenues of approximately $1.8 billion from smartphone sales. Notably, it stood out as the sole firm meeting the set targets, while others faltered post-pandemic.

The scheme’s criteria demanded a minimum ₹250 crore investment in the inaugural fiscal, with subsequent investments in the following years. Moreover, companies had to produce incremental goods, such as premium mobile phones, escalating in value over five consecutive years.

However, the government initially hesitated on Samsung’s incentives, citing invoicing discrepancies. But after prolonged discussions and clarity provision, the government has now agreed to release the incentives.

Luring in big players: Samsung’s inclusion in the PLI scheme, which has seen participation from global firms like Foxconn and Pegatron, as well as local players like Lava and Micromax, underscores its success. As of March 2023, the scheme has attracted investments worth ₹6,600 crore, generating a production of ₹3 trillion and creating over 60,000 jobs.

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