Lok Sabha Question No. 2625 (UNSTARRED), answered on 2025-08-05
Subject: Prioritising Domestic Suppliers
Ministry: COMMERCE AND INDUSTRY
Asked by: Shri Darshan Singh Choudhary

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE

## LOK SABHA

UNSTARRED QUESTION NO. 2625. TO BE ANSWERED ON TUESDAY, THE 05 TH  AUGUST, 2025.

## PRIORITISING DOMESTIC SUPPLIERS

## 2625.  SHRI DARSHAN SINGH CHOUDHARY:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state: वाणिज्य एवं उद्योग मंत्री

- (a) whether the  Government has adopted any policy  or  incentive  measures for motivating industries to record priority to the domestic suppliers over moderately cheaper imported goods;
- (b) if so, the details thereof; and
- (c) the  details  of  the  steps  taken  by  the  Government  to  promote  Economic Nationalism by strengthening the domestic supply chains?

## ANSWER

## वाणिज्य एवं उद्योग मंत्रालय में राज्य मंत्री ( श्री णिणिन प्रसाद ) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY (SHRI JITIN PRASADA)

- (a) to (c): Various  measures  have  been  taken  by  the  Government  to  incentivize  the industries such as:
- i.  Production Linked Incentive (PLI), Scheme has led to a significant increase in production, employment generation, economic growth and exports in the country. Launched with the objective of making India 'Atmanirbhar' is built on the foundation of 14 sectors with an incentive outlay of ₹ 1.97 lakh crore (about US$ 26 billion) to strengthen production capabilities and help create global champions.

Actual investment of Rs. 1.76 lakh crore have been realized till March 2025 across 14 sectors, which has resulted in incremental production/sales of over Rs. 16.5 lakh crore and employment generation of over 12 lakhs (direct and indirect). The impact of PLI Schemes has been significant across various sectors in India. These schemes have incentivized domestic manufacturing, leading to increased production, job creation and a boost in exports.

PLI  Scheme  has  encouraged  major  smartphone  companies  shifting  its production to India. As a result, India has become a major mobile phone manufacturing  country.  The  production  of  mobiles  in  value  terms  has increased by around 146% from INR 2,13,773 Cr in 2020- 21 to INR 5,25,000 crore in 2024-25 as per industry association and DGCIS. During the same period, exports of mobile phones in value terms has increased by around 775% from INR 22,870 crore in 2020- 21 to INR 2,00,000 crore in 2024-25.

Due to the PLI Scheme, there has been a significant reduction in imports of raw materials in the Pharma sector. Unique intermediate materials and bulk drugs are being manufactured in India including Penicillin-G, and transfer of technology  has happened in manufacturing of Medical Devices such as (CT scan, MRI etc.). Under the PLI Scheme for medical devices, 21 projects have started manufacturing of 54 unique medical devices, which include high end devices such as Linear Accelerator (LINAC), MRI, CT-Scan, Heart Valve, Stent, Dialyzer Machine, C-Arm, Cath Lab, Mammograph, MRI Coils, etc.

Cumulative incentive amount of Rs. 21,534 crore have been disbursed as on 24.06.2025  under  PLI  Scheme  for  12  sectors,  namely  Large  Scale Electronics  Manufacturing  (LSEM),  IT  Hardware,  Bulk  Drugs,  Medical Devices, Pharmaceuticals, Telecom & Networking Products, Food Processing, White Goods, Drones & Drone Components, Specialty Steel, Textile products and Automobiles & Auto components.

The Government approved the Production Linked Incentive (PLI) Scheme for Automobile and Auto Components Industry in India (PLI- Auto) in September 2021 which was launched to enhance the country's manufacturing capabilities for advanced automotive products. The Scheme proposes financial incentives for 19 categories of Advanced Automotive Technology (AAT) vehicles and 103  categories  of  AAT  components  to  boost  domestic  manufacturing  of Advanced Automotive Technology products and attract investments in the automotive manufacturing value chain.

The PLI Scheme for White Goods is aimed at developing a robust component ecosystem for the Air Conditioners and LED Lights industry in India, with the goal of making the country an integral part of global supply chains. A unique feature  of  the  scheme  is  that  it  incentivizes  only  the  manufacturing  of components and sub- assemblies, not finished products. Following its launch, India has begun local production of key components such as compressors, copper  tubes,  heat  exchangers,  motors,  and  control  assemblies  for  air conditioners, as well as LED  chip  packaging, drivers, engines, light management  systems,  and  metallized  films  for  capacitors  in  the  LED segment. This shift is significantly reducing import dependency and strengthening domestic manufacturing capabilities.

- ii.  Make  in  India  initiative  was  launched  in  September  2014  to  facilitate investment,  foster  innovation,  build  best  in  class  infrastructure  and  make India  a  hub  of  manufacturing,  design, and  innovation. Presently,  Make  in India 2.0 focuses on 27 sectors implemented across various ministries/departments and state governments.

Government  has  taken  a series of policy initiatives that include the Atmanirbhar  Bharat  packages,  investment  opportunities under National Infrastructure Pipeline (NIP) and National Monetization Pipeline (NMP), India Industrial Land Bank (IILB), Industrial Park Rating System (IPRS), soft launch of the National Single Window System (NSWS), etc. to promote manufacturing. An institutional mechanism to fast-track investments has been put in place, in the form of Project Development Cells (PDCs) in all concerned Ministries/Departments of Government of India.

The  Government  has  also  approved  12  new  project  proposals  under  the National Industrial Corridor Development Programme (NICDP) with total project cost of ₹28,602 crore (incl. land cost) to facilitate manufacturing investments into the country.

- iii.  India  has  signed  the  Supply  Chain  Resilience  Agreement  (Pillar-  II)  in November 2023  under the Indo-Pacific Economic Framework for Prosperity (IPEF), a 14 member plurilateral grouping in the region. The Agreement seeks to strengthen supply chain crucial for national security and economic stability.
- iv. India is signing and negotiating bilateral Free Trade Agreements (FTAs) aimed at  promoting economic trade & economic interest of the country. India has signed 14 FTAs and 6 PTAs (Preferential trade agreements) with its trading partners.  These  trade  agreements  have  contributed  to  enhance  market access, reduce tariff and non-tariff barriers, strengthen strategic partnerships, and support domestic industry through balanced trade facilitation. Collectively, these FTAs reflect a strategic shift towards high-quality, comprehensive trade agreements  designed  to  support  India's  domestic  manufacturing,  services exports, and integration into resilient global value chains.
- v. Department  is  also  issuing  Quality  Control  Orders  (QCOs)  to  mandate minimum quality standards for the imported items.This helps in mitigating the issue of cheap imports and dumping. Minimum Import Price (MIP) regulation is  also  implemented  to  tackle  the  issue  of  cheap  imports  and  to  protect domestic manufacturing.
- vi. Major focus of the department is ensuring Ease of Doing Business (EoDB) in the country. This is done through multiple initiatives such as simplifying and streamlining business regulations including the Business Reform Action Plan (BRAP), the B-Ready assessment, Jan Vishwas and Reducing Compliance Burden on Businesses and Citizens and measurement of Cost of Regulation.

Under,  the  Regulatory  Compliance  Burden  (RCB)  initiative  the  department works  with  various  Ministries,  Departments,  and  States/UTs  to  reduce  the compliance burden on citizens and businesses. The goal is to enhance Ease of Doing Business and Ease of Living through four key strategies: Simplification of procedures, Rationalization of laws, Digitization of processes, and Decriminalization of minor offences.

To enhance ease of doing business, the Government, through the Jan Vishwas (Amendment of Provisions) Act, 2023, has decriminalized 183 provisions across 42 Central Acts administered by 19 Ministries/ Departments. Building on this reform,  the  Hon'ble  Finance  Minister  has  announced  the  Jan  Vishwas  2.0 initiative, under which DPIIT has undertaken an analysis of criminal provisions (including both major and minor offences) across Acts under 39 Ministries/Departments.

- vii. Government of India through its line Ministries / Regulators, so far, a total of 190 Quality Control Order's covering 773 products have been notified for compulsory certification of BIS by various regulators / line Ministries of Government of India, to  enhance  quality  of  goods  imported  into  India  and  to  increase  quality consciousness in the Country.

The Government has taken Several initiatives to strengthen domestic supply chains such as:

- i. The  PM  GatiShakti  National  Master  Plan  (NMP)  platform  which  aims  at enhancing industrial productivity and helping the country to reduce logistics cost,  cut  down  project  delays  and  improve  supply  chain  efficiency  through multi-modal connectivity across highways, railways, ports, airports, logistics infrastructure, and inland waterways.
- ii. The  National  Logistics  Policy  2022  (NLP)  aims  to  create  a  cost-  efficient, resilient,  and  sustainable  logistics  ecosystem.  Focus  areas  in  the  National Logistics  Policy  include  the  Sectoral  Plan  for  Efficient  Logistics  (SPEL)  for major sectors of the economy like Coal, Cement, Fertilizer, Steel, Pharma etc. examining existing supply chain networks and promoting multi-modal transport, digitalization and automation.
- iii. Govt  of  India  is  developing  the  National  Industrial  Corridor  Development Programme, intended to create green field industrial smart cities/clusters of global standards. These industrial corridors are designated areas along major transportation routes, such as Dedicated Freight Corridors (DFCs), Expressways,  and  National  Highways,  where  new  industrial  smart  cities  & manufacturing clusters are planned within a range of 100-200 kms on either side of these routes.

The industrial smart cities/clusters are built 'ahead of demand' with 'plug-nplay'  infrastructure  &  ICT  enabled  utilities,  walk  to  work  culture  facilitating manufacturing investments, boost the supply chain resilience, and reduce the average logistics cost in India.

- iv.  An E-Handbook on Warehousing Standards has been launched recently to promote optimization,  interoperability,  modal-shift,  providing  guidelines  and best  practices  for  optimal  warehouse  space  utilization.  The  warehouse standards prescribed are primarily governing the physical infrastructure of the warehouses including health and sustainability standards. The handbook will serve  as  a  guide  for  infrastructure  improvement,  achieving  efficiency,  cost reduction, attracting investment, adoption of newer technologies and global best practices.
- v. The digital platforms such as PM GatiShakati National Master Plan and Unified Logistics  Interface  Platform  (ULIP)  have  facilitated  data-driven  decisionmaking. ULIP is enabling the industry players to get secure access to the data related to logistics and resources available with various Ministries, strengthening  existing  supply  chain  networks  for  both  domestic  and  export driven industries.

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