Production Linked Incentive (PLI) Scheme for Textiles Part 2

Production Linked Incentive (PLI) Scheme for Textiles Part 2 provides performance based cash incentives to companies that manufacture MMF apparel, MMF fabrics, and technical textiles in India. Ministry of Textiles launched this central scheme, and the fresh application window remains open up to 31 March 2026.

This part of the scheme is made for applicants with lower investment and turnover levels. By 31 March 2026, 170 companies had been approved, bringing investment of ₹8,117.64 crore, turnover of ₹11,241 crore, and employment for 33,427 people.

Production Linked Incentive (PLI) Scheme for Textiles Part 2 - Introduction

Ministry of Textiles notified PLI Scheme for Textiles on 24 September 2021. The scheme promotes production of MMF apparel, MMF fabrics, and technical textile products so the textile industry can reach a bigger scale, become more competitive, and create jobs. A Project Management Agency (PMA) helps carry out the scheme, and an Empowered Group of Secretaries (EGoS) monitors the progress.

In 2025-26, the government made several changes to make the scheme easier for companies. Eight new HSN codes were added for MMF apparel and nine new HSN codes for MMF fabrics. The condition that required a new company has been relaxed. Minimum investment for Part 2 was cut from ₹100 crore to ₹50 crore, and the minimum incremental turnover needed for incentives came down from 25% to 10%.

Scheme Part 2 is for applicants with lower investment and turnover levels. It brings in more mid-sized companies and MSMEs to make high value textile products.

Key Information

Benefits

Selected companies get incentives on the incremental turnover of notified products made in India. Incentives are given for 5 years from the first performance year. Part 2 offers these incentive rates on the required turnover for each year.

• Year 1: 11% incentive on ₹200 crore turnover
• Year 2: 10% incentive on ₹250 crore turnover
• Year 3: 9% incentive on ₹312.5 crore turnover
• Year 4: 8% incentive on ₹390.63 crore turnover
• Year 5: 7% incentive on ₹488.2 crore turnover

Companies must meet the minimum investment and turnover targets. From the second year, they must show at least 10% incremental turnover over the previous year. Payments are made every year through Direct Bank Transfer using the Public Financial Management System (PFMS). Claims are checked by the PMA within 45 days, and payment happens within 15 days after approval. The scheme stays in force until 31 March 2030.

Eligibility

To apply under Part 2, a company must meet these conditions.

• Applicant must be a company, firm, LLP, or trust incorporated in India.
• Minimum investment of ₹50 crore is required for new applicants, excluding land and administrative buildings.
• Minimum turnover of ₹200 crore from notified products is required in the first performance year.
• Only notified textile products must be manufactured.
• Minimum value addition of 60% must be kept, or 30% for processing.
• Valid PAN, GST, and DIN are mandatory.

Earlier, selected applicants had to form a new company under the Companies Act, 2013. That condition is now relaxed, and project units can be set up within existing companies. Priority goes to proposals with higher investment, more employment, better technical capacity, and units in aspirational districts and Category C cities.

Exclusions

Companies that are bankrupt or listed as financial defaulters cannot apply. Entities blacklisted by any government authority are also not covered. Income from trading and income from job work do not count for incentives.

Application Process

Companies must apply online on the official portal. Follow these steps.

STEP 1 - Go to the official portal at pli.texmin.gov.in.

STEP 2 - Fill the registration and application form online and upload all required documents with the signed undertaking.

STEP 3 - Pay the non-refundable application fee of ₹50,000 online.

STEP 4 - Get an acknowledgement receipt with the Application ID after submission.

STEP 5 - Reply to any query raised by Ministry or PMA within the given time.

STEP 6 - After selection, receive the formal Letter of Approval and start manufacturing to meet the targets.

STEP 7 - Submit annual incentive claims online for checking and payment to the bank account.

Documents

Keep these documents ready before applying.

• Application form and signed, notarised undertaking
• Auditor's certificate and chartered engineer certificate
• Audited financial statements and GST invoices
• Quarterly review reports (QRRs)
• Consumption and inventory register
• Proof of investment and company incorporation documents
• PAN, GST, and DIN details

References

For the latest notifications and guidelines, check the official scheme notifications and the official PLI guidelines PDF. Amendment details are available in the PIB press release on scheme amendments and the PIB notice on the extended deadline.

FAQ's

What is Scheme Part 2 of PLI Scheme for Textiles?

Scheme Part 2 is a component for applicants with lower investment and turnover thresholds to promote notified textile products.

What is the minimum investment required now?

New applicants under Part 2 must invest a minimum of ₹50 crore, excluding the cost of land and administrative buildings. Earlier it was ₹100 crore.

What is the minimum turnover required?

Applicants must achieve turnover of at least ₹200 crore from notified products in the first performance year.

What is the incremental turnover growth requirement?

Companies must show at least 10% incremental turnover growth over the previous year from the second year onwards. Earlier this was 25%.

How long are incentives available?

Incentives are given for a maximum of 5 consecutive performance years if the conditions stay fulfilled.

How are incentives paid?

Payments are made through Direct Bank Transfer using the Public Financial Management System (PFMS) after claim checking.

What is the last date to apply?

The fresh application window remains open up to 31 March 2026 on the official portal.