The Department for Promotion of Industry and Internal Trade (DPIIT) has tightened eligibility criteria under PLI Scheme 2. 0 for textiles and apparel, effective April 2025. SME manufacturers and trader-exporters must now meet higher capital expenditure minimums and document compliance quarterly with the Ministry of Commerce.
Non-compliance risks forfeiture of accumulated incentives and regulatory scrutiny.
Market signals
Phase-2 now mandates ₹50 crore minimum capex investment for large enterprises (vs. ₹10 cr in Phase-1), raising entry and sustainability costs significantly.
Participating units must export at least 60% of manufactured goods with minimum 35% domestic value addition; imports of finished fabric face stricter audit trails.
The scheme now requires real-time capex, inventory and export data submission via a dedicated portal integrated with GST GSTR-1/GSTR-3B filings.
Textile businesses must align capex schedules, procurement policies and GST compliance calendars with PLI reporting windows or risk incentive clawback. DGFT and CBIC coordination means export documentation—including duty drawback claims, advance authorizations and bill of entry filings—now carries heightened scrutiny. Vinayakam helps clients map capex phasing to compliance calendars, audit GST–export data reconciliation, and draft board resolutions on PLI eligibility reaffirmation.
Your action checklist
- Conduct capex audit: document all plant, machinery and technology purchases since FY2023–24; verify ₹50 cr threshold (or applicable slab) with independent CA and file declaration with DPIIT within 60 days of scheme notification.
- Reconcile GSTR-1 exports with PLI portal data: cross-check invoices, shipping bills and IEC-wise export values to eliminate discrepancies that trigger CBIC investigations.
- Revise procurement SOPs: establish supplier declarations confirming domestic value addition (≥35%) and flag any imports of finished/semi-finished apparel that breach incentive terms.
- Schedule quarterly compliance reviews: designate a nodal officer for PLI portal submissions, GST filings and external audit coordination; document board approvals for capex and export policy changes.