Hand Tools Industry Calls for Production Linked Incentive Scheme to Boost Manufacturing and Exports

An engineering sector's MSME body has urged the government to introduce a production linked incentive (PLI) scheme for their industry. This initiative aims to enhance domestic manufacturing, increase exports, and create jobs. The Hand Tools Association, based in Ludhiana, communicated this request to the commerce ministry, highlighting the sector's employment potential.

The hand tools industry in India employs 7.25 workers per Rs 1-crore sale annually. This is higher than the bicycle industry's 4.75 and textiles' 5-6 workers per Rs 1-crore sale. The association's President, S C Ralhan, emphasised the industry's vast potential but noted that rapid modernisation is a significant challenge.

Ralhan pointed out that the global hand tools market is valued at Rs 30,000 crore. He believes there is substantial scope for growth and modernisation within this sector. He urged the government to prioritise this industry by including it in the PLI scheme to unlock its full potential.

The socket industry, a component of hand tools, exemplifies this potential. Globally worth Rs 20,000 crore, India's share is less than 1%. Ralhan highlighted that products like spanners, wrenches, and pliers could significantly boost manufacturing and exports if supported by incentives.

The PLI scheme currently covers 14 sectors, including solar PV modules, white goods, electronics, pharmaceuticals, and auto components. Its goal is to establish national manufacturing champions and create job opportunities for India's youth.

The scheme's strategy involves offering companies incentives on incremental sales of products made in India over a base year. This approach aims to make domestic manufacturing globally competitive and foster global champions in manufacturing.

Impact of PLI Scheme on Domestic Manufacturing

Incentives are tailored to boost domestic manufacturing in strategic sectors. They aim to curb cheaper imports, reduce import bills, improve cost competitiveness of local goods, and enhance domestic capacity and exports.

By including the hand tools industry in the PLI scheme, India could significantly increase its share in the global market. This move would not only boost exports but also create numerous job opportunities within the country.