Govt Planning PLI Scheme for Toys, Lab-made Gems, Bicycles

The Centre has already brought toys under compulsory Bureau of Indian Standards certification, quality testing and raised the basic customs duty to 60% from 20% to curb the import of cheap toys, especially from China.

India is eyeing a mega plan to incentivise the manufacturing of bicycles, lab-grown gems and toys in the country and has begun discussions on stitching together production-linked incentive (PLI) schemes for these sectors.

With the successful rollout of PLI schemes for 14 sectors to create national manufacturing champions, discussions are on to have similar incentives for some more job-creating sectors, officials said. "Talks to include toys, bicycles and lab-grown gems within the PLI umbrella are going on," said an official.

The extant PLI schemes have an outlay of ₹1.97 lakh crore and aim to create 6 million jobs in the next five years. "Preliminary discussions are on with various stakeholders," said an official.

Lab-grown diamonds are grown are chemically, physically, and optically the same as the natural ones. Besides jewellery, they are used in computer chips, satellites and 5G networks.

India exported $1.3 billion worth of lab-grown diamonds in FY21, mostly to the US, Hong Kong, UAE, Israel and Belgium. "The export potential for lab-grown diamonds is huge as we are seeing great demand for these stones, especially from the US. A PLI scheme may help reduce the trade deficit," said an industry representative.

India's largest bank, State Bank of India , has also formalised a policy to fund units engaged in manufacturing of lab-grown diamonds under certain conditions.

"PLI schemes are welcome for the three sectors, especially since a large part of these imports are from China and other Asian countries, and this incentive will help bridge the disabilities being faced by domestic manufacturers," said Bipin Sapra, partner, EY India.

The Centre has already brought toys under compulsory Bureau of Indian Standards certification, quality testing and raised the basic customs duty to 60% from 20% to curb the import of cheap toys, especially from China. Imports of dolls, wheeled toys, puzzles, video game consoles and novelty jokes and tricks shrank 70.35% in FY22 at $110 million from $371 million in 2018-19.