The Government of India has extended the Production Linked Incentive (PLI) Scheme for Promoting Domestic Manufacturing of Medical Devices up to 2035–36. The government has also invited fresh applications under the scheme, with an available financial outlay of approximately ₹2,700 crore. The revised scheme, known as PLI-MD 2.0, aims to strengthen India’s domestic medical device manufacturing industry, reduce dependence on imports, promote critical component manufacturing and make India a globally competitive hub for medical technology.
To encourage greater participation from investors and manufacturers, the government has simplified the eligibility criteria, reduced the minimum investment requirement and discontinued the minimum sales threshold for claiming incentives. The renewed scheme is an important step towards achieving the objectives of Atmanirbhar Bharat and Make in India, particularly in the healthcare and medical technology sectors.
Why Is the PLI Scheme for Medical Devices in the News?
On 10 November 2026, the Government of India announced fresh applications under the Production Linked Incentive Scheme for Promoting Domestic Manufacturing of Medical Devices. The scheme has been extended until FY 2035–36, with approximately ₹2,700 crore available for investment incentives. The revised guidelines focus on making the scheme more investor-friendly and encouraging domestic manufacturing of high-end medical equipment and critical components.
The major announcements include:
- Extension of the scheme up to 2035–36.
- Fresh applications invited from eligible manufacturers.
- Approximately ₹2,700 crore financial outlay available.
- Discontinuation of the minimum sales threshold requirement for claiming incentives.
- Reduction in the minimum investment requirement.
- Simplification of eligibility conditions and incentive procedures.
- Greater emphasis on critical component manufacturing.
- Three years provided to applicants to establish manufacturing facilities.
- Continuous application window over an extended period.
The online application portal is expected to become operational within 10 days of the announcement.
What Is the PLI Scheme for Medical Devices?
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- The Production Linked Incentive Scheme for Promoting Domestic Manufacturing of Medical Devices (PLI-MD) is a government initiative designed to encourage companies to manufacture medical devices within India.
- Under this scheme, eligible manufacturers receive financial incentives linked to their incremental production and sales of eligible medical devices manufactured in India.
- In simple words, the government provides incentives to companies to encourage them to manufacture more medical equipment and components domestically rather than depending heavily on imports.
The scheme focuses on:
- Promoting domestic manufacturing of medical devices.
- Encouraging investment in the medical technology sector.
- Developing indigenous manufacturing capabilities.
- Reducing dependence on imported medical equipment.
- Strengthening domestic supply chains.
- Improving the quality and competitiveness of Indian medical devices.
The scheme was originally launched in 2020–21.
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Key Features of the Extended PLI-MD Scheme
| Particulars | Details |
|---|---|
| Scheme | PLI Scheme for Promoting Domestic Manufacturing of Medical Devices |
| Original launch | 2020–21 |
| Revised scheme | PLI-MD 2.0 |
| Extended period | Up to FY 2035–36 |
| Financial outlay available | Approximately ₹2,700 crore |
| Application status | Fresh applications invited |
| Manufacturing facility setup period | 3 years |
| Incentive focus | Domestic production of medical devices and critical components |
| Implementing approach | Simplified and investor-friendly guidelines |
Four Target Segments Under PLI-MD 2.0
The extended scheme covers four major target segments. These segments have been designed to promote manufacturing across different stages of the medical device value chain.
Target Segment 1: Medical Consumables, Disposables and Implants
This segment focuses on the domestic manufacturing of medical consumables, disposable products and implants.
Examples include:
- Medical consumables.
- Disposable medical products.
- Orthopaedic implants.
- Cardiac implants.
Key focus: Creating manufacturing scale and ensuring world-class product quality.
The government wants Indian manufacturers to develop the capacity to produce these products at competitive prices while maintaining high quality standards.
Target Segment 2: Critical Components
- This segment focuses on manufacturing critical components required for medical devices.
- Many advanced medical devices depend on specialised components and technologies. Import dependence in these areas can increase production costs and create supply chain vulnerabilities.
- The scheme aims to encourage domestic production of such components.
- Key focus: Strengthening indigenous component manufacturing and developing an integrated domestic supply chain.
- This segment is also expected to create opportunities for Micro, Small and Medium Enterprises (MSMEs).
Target Segment 3: High-End Medical Devices at a Nascent Stage of Domestic Manufacturing
This segment covers advanced medical equipment where domestic manufacturing is still at an early stage.
Examples of high-end medical technologies include:
- 3T MRI machines.
- PET-CT systems.
- Advanced diagnostic equipment.
- High-end medical imaging technologies.
Key focus: Encouraging domestic manufacturing of advanced medical technologies that are not yet sufficiently developed in India.
The scheme aims to improve technological capabilities and reduce dependence on imported high-end medical equipment.
Target Segment 4: High-End Medical Devices Currently Only Assembled in India
- This segment focuses on medical devices that are currently assembled in India but have limited domestic manufacturing of their components and technology.
- The objective is to move beyond simple assembly towards deeper manufacturing and greater domestic value addition.
- Key focus: Developing an integrated manufacturing ecosystem and strengthening the domestic value chain.
Incentive Rates Under PLI-MD 2.0
The revised scheme provides different tapering incentive rates for the four target segments.
| Target Segment | Manufacturing Category | Average Tapering Incentive Rate |
|---|---|---|
| TS 1 | Medical consumables, disposables and implants | Approximately 5% |
| TS 2 | Critical components | Approximately 9% |
| TS 3 | High-end medical devices at a nascent manufacturing stage | Approximately 9% |
| TS 4 | High-end medical devices currently assembled in India | 6% |
What does a tapering incentive rate mean?
- A tapering incentive rate refers to an incentive structure in which the rate gradually reduces over a specified period.
- The objective is to provide financial support to manufacturers while gradually encouraging them to become competitive without depending permanently on government incentives.
- The higher average incentive rates for TS 2 and TS 3 highlight the government’s focus on critical component manufacturing and advanced medical technology.
Major Changes Introduced in PLI-MD 2.0
Based on the experience gained during the first phase of the scheme, the government has introduced several changes to make the revised scheme easier to access.
A. Minimum Sales Threshold Requirement Discontinued
- Earlier, manufacturers were required to meet a specified minimum sales threshold to claim incentives.
- Under the revised scheme, this minimum sales threshold requirement has been discontinued.
Why is this important?
- This change can make the scheme more accessible to manufacturers, particularly companies that are in the initial stages of developing their production capacity.
- It can also reduce the pressure on new investors to achieve a particular sales level before becoming eligible to claim incentives.
B. Minimum Investment Requirement Reduced
- The government has also reduced the minimum investment requirement under the revised scheme.
- This is expected to encourage greater participation from manufacturers and investors who may have faced difficulties meeting the earlier investment conditions.
- It can also create opportunities for smaller manufacturers and MSMEs.
C. Three Years to Establish Manufacturing Facilities
Applicants will be allowed three years to establish their manufacturing facilities under any of the four target segments.
This provides companies with additional time to:
- Acquire land and infrastructure.
- Install machinery and equipment.
- Develop manufacturing facilities.
- Establish production processes.
- Build technological capabilities.
D. Multiple Applications Permitted
- Applicants can submit any number of applications under one or more target segments.
- This provides greater flexibility to companies interested in manufacturing different categories of medical devices and components.
E. Continuous Application Window
- The application window will remain continuously open over an extended period.
- This will give potential investors and manufacturers more flexibility in submitting their applications.
F. Simplified and Investor-Friendly Guidelines
- The government has simplified eligibility conditions and procedures for claiming incentives to improve Ease of Doing Business (EoDB).
- These changes aim to reduce procedural difficulties and encourage investment in the medical device industry.
Achievements of the First Phase of the PLI Scheme
The first phase of the PLI Scheme for Medical Devices has contributed to the development of India’s domestic medical device manufacturing ecosystem.
According to the government announcement, the scheme has resulted in:
- Domestic manufacturing of more than 60 high-end medical devices and components.
- Production valued at over ₹16,000 crore.
- Development of manufacturing capabilities in advanced medical technologies.
- Expansion of domestic manufacturing of medical equipment and components.
Some important medical devices and components manufactured under the scheme include:
| Category | Examples |
|---|---|
| Medical imaging | 1.5T MRI machines |
| Diagnostic equipment | CT scanners |
| Cancer treatment equipment | LINAC machines |
| Radiology components | X-ray tubes and detectors |
| Breast imaging | Mammography machines |
| Cardiac treatment | Cathlab equipment |
| Medical implants | Orthopaedic and cardiac implants |
| Kidney treatment | Dialyzers |
These achievements indicate that India is gradually developing its capabilities in the manufacturing of advanced medical technologies.
Why Is Critical Component Manufacturing a Major Focus?most asked
- One of the most important aspects of PLI-MD 2.0 is its emphasis on critical component manufacturing.
- Medical devices are often made up of several specialised components that require advanced technology and precision engineering.
- If these components are imported, domestic manufacturers may remain dependent on foreign suppliers even when the final product is assembled in India.
- For example, manufacturing an advanced MRI machine requires specialised components and sophisticated technologies.
- Therefore, domestic production of critical components is important for developing a complete manufacturing ecosystem.
The focus on critical components is expected to:
- Reduce dependence on imported components.
- Strengthen domestic supply chains.
- Encourage technology transfer and innovation.
- Improve the competitiveness of Indian manufacturers.
- Create opportunities for MSMEs.
- Increase domestic value addition.
- Support the development of high-end medical equipment.
In the long run, this approach can help India move from assembling medical devices to manufacturing them across the entire value chain.
Objectives of PLI-MD 2.0
The extended scheme aims to achieve several important economic and industrial objectives.
1. Promote Atmanirbhar Bharat
The scheme aims to increase domestic manufacturing capabilities and reduce India’s dependence on imported medical devices.
2. Strengthen Make in India
It encourages domestic and international companies to establish manufacturing facilities in India.
3. Develop Indigenous Supply Chains
The scheme aims to create a strong domestic ecosystem for manufacturing medical devices and their critical components.
4. Attract Domestic and Foreign Investment
Simplified guidelines and reduced investment requirements are expected to encourage greater participation from investors.
5. Generate Employment Opportunities
The expansion of manufacturing facilities can create direct and indirect employment opportunities in engineering, healthcare technology, production and research.
6. Improve the Quality of Made in India Medical Devices
The scheme aims to promote high-quality medical devices that can compete with international products.
7. Reduce the Cost of Medical Devices
Increasing domestic production and improving manufacturing efficiency may help reduce the cost of medical equipment over time.
8. Enhance India's Global Competitiveness
The scheme aims to establish India as a competitive manufacturing destination for advanced medical technologies.
Significance of the Scheme for India's Economy and Healthcare Sector
A. Reducing Import Dependence
India’s medical device industry has historically relied on imports for several advanced medical technologies and specialised components.
Developing domestic manufacturing capabilities can reduce external dependence and improve supply chain resilience.
B. Boost to the MSME Sector
The focus on critical components creates opportunities for MSMEs to become suppliers to larger medical device manufacturers.
Smaller enterprises can participate in manufacturing specialised parts, components and supporting technologies.
C. Strengthening Healthcare Infrastructure
Greater availability of domestically manufactured medical equipment can support hospitals, diagnostic centres and healthcare institutions.
It may also improve access to advanced medical technologies across different regions.
D. Encouraging Innovation and Technology Development
Manufacturing advanced medical devices requires research, development, engineering skills and technological expertise.
The scheme can encourage investment in these areas and strengthen India’s medical technology ecosystem.
E. Employment Generation
The expansion of manufacturing facilities can create employment opportunities for engineers, technicians, researchers, production workers and other skilled professionals.
F. Improving Export Competitiveness
As domestic manufacturers improve product quality, technological capabilities and production scale, India can strengthen its position in the global medical device market.
Challenges in India's Medical Device Manufacturing Sectormost asked
Despite the progress made under the PLI scheme, India faces several challenges in developing a globally competitive medical device industry.
1. Dependence on Imported Technology: Advanced medical equipment requires sophisticated technologies and specialised components that may not be readily available domestically.
2. High Research and Development Costs: Developing advanced medical devices requires significant investment in research, testing and innovation.
3. Limited Domestic Component Ecosystem: India needs a stronger network of domestic suppliers for specialised components and precision-engineered products.
4. Quality and Regulatory Requirements: Medical devices must meet strict safety, quality and performance standards. Manufacturers need strong testing and certification infrastructure.
5. Skilled Workforce Requirements: Advanced manufacturing requires trained professionals with expertise in electronics, biomedical engineering, robotics and precision manufacturing.
6. Global Competition: Indian manufacturers face competition from established medical technology companies in countries with advanced manufacturing ecosystems.
Addressing these challenges will be important for achieving the long-term objectives of PLI-MD 2.0.
PLI-MD 2.0 and the Vision of Atmanirbhar Bharat
- The extended PLI scheme is closely connected with the government’s broader vision of Atmanirbhar Bharat.
- The idea is not simply to manufacture finished medical devices within India but to develop the complete manufacturing ecosystem, including components, technology, research and innovation.
- By encouraging domestic production of high-end equipment such as 3T MRI machines, PET-CT systems, ultrasound probes and consoles, and high-throughput In-Vitro Diagnostic (IVD) analysers, the scheme aims to strengthen India’s technological capabilities.
- It also supports the Make in India initiative by encouraging companies to manufacture advanced medical technologies domestically.
- In this way, PLI-MD 2.0 can contribute to India’s transition from an import-dependent market to a globally competitive medical technology manufacturing hub.
Frequently Asked Questions (FAQs)
Q1. What is the PLI Scheme for Medical Devices?
The PLI Scheme for Medical Devices is a government initiative launched in 2020–21 to promote domestic manufacturing of medical equipment and components through production-linked financial incentives.
Q2. Until when has the PLI Scheme for Medical Devices been extended?
The scheme has been extended up to FY 2035–36.
Q3. What is the financial outlay available under the extended PLI-MD scheme?
Approximately ₹2,700 crore is available under the extended scheme.
Q4. What is PLI-MD 2.0?
PLI-MD 2.0 refers to the extended and revised version of the Production Linked Incentive Scheme for Promoting Domestic Manufacturing of Medical Devices.
Q5. How many target segments are covered under PLI-MD 2.0?
The scheme covers four target segments: medical consumables, disposables and implants; critical components; high-end medical devices at a nascent stage of domestic manufacturing; and high-end medical devices currently assembled in India.
Q6. What are the major changes introduced under the revised scheme?
The minimum sales threshold requirement has been discontinued, the minimum investment requirement has been reduced, the guidelines have been simplified, and applicants have been given three years to establish manufacturing facilities.
Q7. What is the main focus of PLI-MD 2.0?
The main focus is to promote domestic manufacturing of medical devices, strengthen critical component manufacturing, develop indigenous supply chains and reduce import dependence.
Q8. How does the scheme benefit MSMEs?
The scheme’s focus on critical component manufacturing is expected to create opportunities for MSMEs to participate in the domestic medical device supply chain.
Conclusion
The extension of the PLI Scheme for Medical Devices up to 2035–36 represents an important step towards strengthening India’s medical technology manufacturing industry. The revised PLI-MD 2.0 framework goes beyond encouraging the production of finished medical devices. It places greater emphasis on critical component manufacturing, domestic value addition, advanced technology and integrated supply chains.
The removal of the minimum sales threshold, reduction in the minimum investment requirement and simplification of application procedures are expected to make the scheme more accessible to manufacturers and investors. If implemented effectively, the scheme can help India reduce import dependence, strengthen healthcare infrastructure, generate employment and emerge as a globally competitive hub for medical device manufacturing.
