The government has extended its Production Linked Incentive (PLI) scheme for domestic medical device manufacturing until the financial year 2035-36, inviting fresh applications under a revised programme designed to strengthen India’s medical technology supply chain. The Department of Pharmaceuticals announced the extension on November 10, retaining an available financial outlay of approximately ₹2,700 crore.
The revamped scheme places greater emphasis on manufacturing critical components, medical consumables and advanced equipment that India continues to import. Alongside the extension, the government has relaxed eligibility conditions, removed the minimum sales threshold for claiming incentives and reduced the minimum investment requirement. The changes are intended to attract more manufacturers and encourage deeper domestic production rather than relying primarily on assembling imported equipment.
Medical Devices PLI Scheme Extended to FY2035-36
The Department of Pharmaceuticals has extended the PLI scheme for medical devices by eight years, providing manufacturers with a longer period to establish facilities and scale production.
The government has also invited fresh applications from companies interested in participating in the expanded programme. According to the Department of Pharmaceuticals, approximately ₹2,700 crore in available scheme outlay will be utilised for the revised initiative.
The online application portal is expected to become operational within 10 days of the November 10 announcement. The application window will remain open for an extended period, allowing companies to submit applications across one or more eligible target segments.
The extension reflects the government’s continued effort to strengthen India’s medical device manufacturing capabilities. Medical technology is a strategically important sector because hospitals, diagnostic laboratories and healthcare providers depend on a wide range of specialised equipment, components and consumables.
Four Target Segments Under the Revised PLI Scheme
The expanded programme divides eligible manufacturing activities into four target segments. The structure is intended to support both established product categories and technologies where domestic manufacturing remains limited.
| Target segment | Manufacturing focus | Average tapering incentive rate |
|---|---|---|
| TS1 | Medical consumables, disposables and implants | Around 5% |
| TS2 | Critical components | Around 9% |
| TS3 | High-end devices with nascent domestic manufacturing | Around 9% |
| TS4 | High-end devices currently assembled in India | Around 6% |
The incentive rates are structured differently across segments, with higher support for critical components and advanced devices. This approach reflects the complexity of developing domestic capabilities in specialised manufacturing areas.
Greater emphasis on critical components
One of the most important changes is the stronger focus on critical components. Manufacturing sophisticated medical equipment requires more than assembling finished products. It also depends on specialised parts, electronic systems, imaging technologies, sensors and other precision-engineered components.
India’s dependence on imported components can expose manufacturers to international supply disruptions, currency movements and changing import costs. Building domestic production capabilities could help companies develop more reliable supply chains.
The government also expects the critical-component segment to create opportunities for micro, small and medium enterprises (MSMEs), which could participate as suppliers to larger medical technology manufacturers.
Support for advanced medical equipment
The revised programme also targets high-end equipment that is either not manufactured domestically at scale or is currently assembled in India using imported technologies and components.
The government has identified products such as 3-tesla MRI machines, PET-CT scanners, ultrasound probes and consoles, and high-throughput in-vitro diagnostic (IVD) analysers as areas where deeper manufacturing capabilities are needed.
Developing these technologies locally could help India move beyond basic manufacturing and assembly towards more sophisticated medical technology production.
Eligibility Conditions Relaxed to Attract More Manufacturers
The government has modified several conditions following its experience with the first phase of the scheme. The objective is to make participation more practical for existing companies as well as new investors.
One major change is the removal of the minimum sales threshold previously required to claim incentives. Manufacturers will no longer need to meet that specific minimum sales condition to qualify for incentive payments under the revised framework.
The minimum investment requirement has also been reduced. The earlier framework included a minimum investment requirement of ₹180 crore, which officials said had been lowered under the revised scheme. The government has not specified the revised minimum figure in its announcement.
These changes could make the programme more accessible to companies that have the technology and manufacturing capabilities to enter the market but may not be able to commit to the earlier investment threshold.
Companies receive three years to establish facilities
The revised scheme gives applicants three years to establish manufacturing facilities across the four target segments.
This provides manufacturers with more time to secure land, purchase specialised machinery, arrange technology partnerships, recruit skilled employees and complete other steps required before commercial production.
The earlier framework had tighter implementation timelines in some cases, with companies sometimes facing deadlines of approximately one year or fixed commercial production dates.
The revised timeline recognises that medical device manufacturing can involve complex technical requirements, regulatory processes and significant capital expenditure.
First Phase Generated More Than ₹16,000 Crore in Production
The original medical devices PLI scheme was launched in 2020-21 to encourage domestic manufacturing and reduce dependence on imported products.
According to the Department of Pharmaceuticals, the programme has supported the domestic production of more than 60 high-end medical devices and components. These include X-ray tubes and detectors, 1.5-tesla MRI machines, CT scanners, linear accelerators, cath lab equipment, mammography machines, orthopaedic and cardiac implants, and dialysis products.
The department estimates that production worth more than ₹16,000 crore has been generated under the scheme.
| Indicator | Government-reported position |
|---|---|
| Original scheme launch | 2020-21 |
| Extended scheme period | Until FY2035-36 |
| Available scheme outlay | Approximately ₹2,700 crore |
| Production generated under the first phase | More than ₹16,000 crore |
| High-end devices and components manufactured | More than 60 |
| Facility establishment period under revised rules | Three years |
These figures indicate that the first phase helped establish manufacturing capacity in several medical device categories. However, the government’s decision to redesign the programme also reflects the need to address gaps in the domestic supply chain, particularly in specialised components and advanced technologies.
India’s Medical Device Import Dependence Remains a Challenge
India has developed a growing medical device manufacturing industry, but imported equipment and components continue to play an important role in meeting domestic healthcare demand.
Moneycontrol reported that industry estimates suggest medical device imports could exceed ₹1 lakh crore this year. This highlights the scale of the opportunity for domestic manufacturers, while also showing the challenges involved in reducing import dependence.
Medical devices cover a broad range of products, from relatively simple consumables and disposable equipment to sophisticated imaging systems and diagnostic technologies. Manufacturing these products requires different levels of investment, technical expertise, quality control and regulatory compliance.
For advanced equipment, developing domestic capabilities can be particularly challenging because manufacturers need access to specialised components, engineering expertise and established technology platforms.
The revised PLI framework attempts to address these gaps by supporting multiple stages of the manufacturing value chain rather than concentrating only on finished products.
However, incentives alone may not be sufficient. Companies will also need access to reliable suppliers, skilled workers, research and development capabilities, quality testing infrastructure and predictable regulatory processes.
What the Extension Means for India’s Medical Technology Industry
The longer policy timeline could improve investment visibility for manufacturers considering new production facilities in India. Medical technology projects often require substantial upfront investment, and companies may need several years to develop products, establish production lines and build relationships with hospitals and healthcare providers.
The revised incentives could also encourage partnerships between domestic manufacturers and international medical technology companies. Such partnerships may help bring specialised manufacturing processes, technical expertise and product development capabilities into the country.
For MSMEs, the stronger focus on components could create opportunities to supply parts and subassemblies to larger manufacturers. This could gradually expand the number of domestic companies participating in the medical technology supply chain.
The programme may also have implications for healthcare costs over the longer term. Greater domestic production could reduce exposure to imported equipment costs and supply disruptions. However, any reduction in prices will depend on manufacturing efficiency, competition, product quality and the extent to which imported inputs are replaced.
The Bigger Picture
The extension of the medical devices PLI scheme is part of India’s broader effort to strengthen domestic manufacturing in strategically important industries. In medical technology, the challenge is not simply to produce more finished devices but to develop the engineering, component manufacturing and technology capabilities needed to support the entire industry.
The shift towards critical components and advanced equipment is significant because it addresses a deeper weakness in the supply chain. If manufacturers can build local capabilities in specialised parts and technologies, India could become less dependent on imported equipment and gradually develop a stronger position in the global medical technology market. The success of this effort, however, will depend on actual investment, technology transfer, product quality and sustained demand.
Looking Ahead
The next phase of the scheme will depend on how many companies apply, which manufacturing segments attract investment and how effectively the revised eligibility conditions address the limitations of the earlier programme. The opening of the application portal and the subsequent selection of manufacturers will provide an early indication of industry participation. Progress will also need to be measured through actual production, domestic value addition and the development of critical component suppliers.
Over the longer term, the government’s objective is to move India’s medical device industry towards deeper manufacturing and greater technological capability. The extension until FY2035-36 provides a longer policy horizon, but reducing import dependence will require more than financial incentives. Consistent investment in research, skilled manufacturing, testing infrastructure and globally competitive quality standards will be essential for building a sustainable domestic medical technology ecosystem.
SEO Metadata
SEO Title: Government Extends Medical Devices PLI Scheme Until FY2036
Meta Description: India extends its ₹2,700 crore medical devices PLI scheme until FY2035-36, easing eligibility rules and prioritising critical components and advanced equipment.
URL Slug: medical-devices-pli-scheme-extended-fy2036
Focus Keyphrase: Medical devices PLI scheme
Secondary Keywords: Medical device manufacturing in India, PLI scheme FY2036, medical device imports, critical medical components, Department of Pharmaceuticals, Make in India medical devices
Get the day’s top stories in your inbox
One concise email. No spam, unsubscribe anytime.
