According to Sandip Sabarwal, PLIs fund unproductive businesses and save taxes by using bats

 According to Sandip Sabarwal, PLIs fund unproductive businesses and save taxes by using bats

Sandip Sabharwal said that PLIs make it tough for new gamers to join on his X (previously known as Twitter) account.

The Indian government is now modifying and broadening the production-linked incentives (PLI) program to include other industries. However, Sandip Sabharwal, the former head of Equity SBI MF, has expressed the opinion that PLIs are an unproductive use of public funds since they incentivize inefficient enterprises.

But all it's doing is using government funds to line the coffers of incompetent corporations. Additionally, it eliminates the equal playing field by making it impossible for new players to join and never be able to compete with PLI players. On November 2, Sabharwal posted on his X account, which was previously Twitter, saying that it would be better to lower total taxes or GST to encourage development.

His Twitter provoked a discussion, with some X users agreeing with Sabharwal and others saying that PLI initiatives are beneficial. One user said, "India needs to start the process through incentives because it is so late and insufficiently competitive in the global manufacturing race."

One person commented, "A valid viewpoint! Although PLI programs may help certain industries, they also raise questions about fair competition and efficiency. A different strategy to encourage entrepreneurship and broad-based economic development would be to lower total taxes or reconsider the GST. "The goal of the PLI scheme is to turn local leaders into global giants, 'inefficient cos' first have to fulfil commitment investments and then have to accomplish committed sales," said a different user.

With an investment of Rs 1.97 lakh crore, the Indian government introduced the PLI scheme in 2021 to encourage manufacturing in 14 sectors, including large-scale electronics manufacturing, white goods, textiles, medical device manufacturing, automotive manufacturing, specialty steel, food products, high-efficiency solar PV modules, advanced chemistry cell batteries, drones, as well as pharmaceuticals