India’s 14 Production Linked Incentive (PLI) schemes have generated 8.49 lakh jobs as of March 2026, achieving just 28% of their combined employment target of approximately 30.2 lakh jobs, according to a new assessment by NITI Aayog. The findings highlight a gap between the government’s manufacturing investment ambitions and the employment opportunities created so far.
The report, titled Impact Assessment of PLI Schemes, presents a mixed picture of the flagship manufacturing programme. While employment generation remains behind the overall target, the schemes have attracted ₹2.40 lakh crore in investments and generated production and sales worth ₹22.66 lakh crore. These figures represent 76% of the investment target and 64% of the production target, respectively, as of March 2026.
PLI Schemes Generate 8.49 Lakh Jobs Against 30 Lakh Target
The 14 PLI schemes have been introduced across key manufacturing sectors to encourage domestic production, attract investments, increase exports and strengthen India’s position in global supply chains.
However, employment generation has progressed more slowly than investment and production.
According to NITI Aayog, the schemes had generated employment for 8,49,069 people by March 2026, compared with a full-tenure target of approximately 30.2 lakh jobs.
| Performance indicator | Achievement by March 2026 | Full-tenure target | Target achieved |
|---|---|---|---|
| Investment | ₹2.40 lakh crore | ₹3.15 lakh crore | 76% |
| Production and sales | ₹22.66 lakh crore | ₹35.37 lakh crore | 64% |
| Employment | 8.49 lakh jobs | Around 30.2 lakh jobs | 28% |
| Incentives disbursed | ₹35,354 crore | ₹1.91 lakh crore outlay | 18.51% |
The figures show that companies have invested in manufacturing capacity and increased production faster than they have expanded their workforces.
However, NITI Aayog cautioned against interpreting the employment figure as a final assessment of the programme. The schemes had completed approximately 58% of their combined implementation period by March 2026, leaving around 42% of the total duration remaining.
The assessment therefore covers schemes at different stages of maturity, with some still building factories, commissioning equipment and increasing production capacity.
Employment Generation Slowed Sharply in FY26
The report also examined how employment generation performed against annual targets over the implementation period.
The figures show that the schemes initially recorded relatively strong employment outcomes before falling significantly in FY26.
| Financial year | Employment achievement against annual target |
|---|---|
| Up to FY23 | 86% |
| FY24 | Around 85% |
| FY25 | 156% |
| FY26 | 31% |
Employment generation exceeded the annual target in FY25 but dropped to just 31% of the target in FY26.
This uneven performance suggests that job creation has not kept pace consistently with the expansion of manufacturing activity.
NITI Aayog explained that investment generally takes place before manufacturing facilities become fully operational. Production then increases as capacity is commissioned and utilisation improves, while employment can grow further as factories reach commercial scale.
The time required to establish manufacturing facilities, introduce advanced technologies and expand production can therefore influence when jobs are created.
Only Four PLI Sectors Classified as On Track
The assessment examined all 14 PLI sectors across investment, production, exports and employment.
It found that four sectors were broadly on track across the assessed indicators:
- Large-scale electronics manufacturing
- Pharmaceutical drugs
- Telecommunications and networking products
- Food products
These sectors have demonstrated relatively strong progress in areas such as manufacturing capacity, investment and output.
The large-scale electronics manufacturing programme, particularly mobile phone production, emerged as one of the strongest performers. The report highlighted growth in production, sales, exports and employment involving both domestic and international companies.
The pharmaceutical sector has also recorded encouraging outcomes, reflecting investments in domestic manufacturing capabilities.
Other sectors have shown progress in selected areas but require additional improvements.
For example, the automobile and auto components sector has demonstrated encouraging investment and production performance, while employment, exports and domestic value addition require further strengthening.
The assessment also identified weaker or partial outcomes in certain areas, including exports under the bulk drugs scheme, employment under the medical devices programme and investment under the IT Hardware 2.0 scheme.
PLI Schemes Attract ₹2.40 Lakh Crore in Investment
The investment performance represents one of the programme’s more significant achievements.
The 14 schemes have attracted cumulative investments of ₹2,40,138 crore against a target of approximately ₹3.15 lakh crore.
Production and sales generated under the programme reached ₹22,66,412 crore by March 2026.
The government has approved a combined financial outlay of ₹1,91,049 crore for the 14 schemes. However, incentives disbursed so far amounted to ₹35,354 crore, representing approximately 18.51% of the total approved outlay.
The relatively low disbursement percentage reflects the structure of the programme. Companies receive incentives after meeting specified production and other eligibility requirements rather than receiving the entire allocation upfront.
The difference between approved funding and actual disbursement also reflects the fact that schemes are at different stages of implementation.
Why Employment Is Lagging Behind Investment
One of the central findings of the NITI Aayog assessment is that investment growth does not automatically translate into employment at the same pace.
Manufacturing companies may initially spend heavily on land, machinery, technology, production equipment and factory infrastructure. These investments can increase production capacity without immediately creating large numbers of jobs.
The effect is particularly relevant in sectors involving advanced technology and capital-intensive manufacturing.
For example, semiconductor-related components, battery manufacturing and specialised industrial production require substantial upfront investment. Automated production processes can also increase output without requiring a proportionate increase in workers.
NITI Aayog said differences in technology adoption, investment cycles, global competition and capital requirements explain why performance varies across sectors.
The report also emphasised the need to examine employment outcomes alongside production, exports and investment rather than relying on a single indicator to judge the programme.
NITI Aayog Calls for Demand-Side Support
The assessment recommends changes to the design of future PLI programmes, including a greater focus on demand-side measures.
The existing approach is largely supply-driven. Companies receive financial incentives linked to production, encouraging them to build capacity and manufacture more goods.
However, NITI Aayog said long-term manufacturing growth also requires sufficient demand for domestically produced products.
The report suggested several areas for improvement:
Stronger domestic procurement: Government procurement frameworks could help create demand for eligible products manufactured in India.
Export market development: Companies need better access to international markets to increase production beyond domestic demand.
Strategic government purchasing: Public-sector demand could support selected manufacturing industries and encourage domestic supply-chain development.
Policies to stimulate consumption: Measures that encourage the purchase of domestically manufactured high-value goods could help improve capacity utilisation.
The report also called for greater industry participation in setting scheme targets, improved coordination between the Centre and state governments, deeper MSME participation and standardised reporting and monitoring systems.
These measures are intended to make future incentives more closely aligned with the needs of individual sectors.
What the PLI Findings Mean for India’s Manufacturing Strategy
The PLI programme is a central part of India’s effort to become a more competitive manufacturing destination and reduce dependence on imported products.
Its 14 schemes cover industries ranging from electronics, pharmaceuticals and automobiles to textiles, telecommunications, food processing, solar modules and advanced batteries.
The latest assessment suggests that the programme has helped attract substantial investments and expand domestic production. However, its employment performance remains an important area of concern.
The difference between investment and job creation also raises questions about the types of manufacturing activities being encouraged and how much domestic value addition is taking place.
For policymakers, the challenge is to ensure that incentives support not only higher output but also stronger supplier networks, export competitiveness and employment opportunities.
The Bigger Picture
India’s PLI programme has made measurable progress in attracting manufacturing investment and increasing production, but the employment figures show that the benefits have not yet translated into jobs at the same pace. The 28% employment achievement needs to be understood against the fact that the schemes have completed only 58% of their combined implementation period.
The next phase will require more than expanding factory capacity. Stronger domestic demand, export opportunities, MSME participation and sector-specific policy adjustments will be important in converting manufacturing investments into sustained economic activity and employment.
Looking Ahead
NITI Aayog has indicated that the government will review schemes requiring changes in coordination with the relevant ministries. Future policy adjustments are expected to focus on sector-specific challenges, demand creation and better monitoring of employment and production outcomes.
As the remaining implementation period progresses, the key question will be whether the investments already made can generate additional production, exports and jobs. The PLI programme’s long-term success will depend on its ability to build competitive domestic industries while delivering broader economic benefits beyond manufacturing capacity alone.
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