PLI: Money flows in opposite direction – govt to corporates

Thanks to the perseverance of RTI activists and like-minded NGOs, supported by competent lawyers, we are discovering how money flowed from the pockets of big and small corporates into the coffers of prominent political parties. Some of them donated Electoral Bonds (EBs) worth several times more than the yearly profits they made. One is reminded of Emperor Harshavardhana, whose gift-giving habits are said to have landed him in penury. But the motivation behind the ancient custom of giving daana and the modern practice of contributing chandaa are simply not comparable because that one was primarily “other-worldly” while this one is more “idhar-worldly” (materialistic). With the non-godi media burrowing deep to unearth the backward and forward linkages of such chandaa-giving, the dust on this ‘bonding affair’ between political parties and corporates(and shell companies) will take a long time to settle.

But what about the flow of money in the other direction – from the government to corporates, which is taxpayers’ money being transferred into the pockets of corporates via government schemes?

Most of the public debate remains limited to the tax reliefs and other concessions that governments announce for them. Under Prime Minister Narendra Modi’s variousprogrammes, monies that we pay in the form of income tax, GST and Excise duties have been flowing into the pockets of corporates since 2021. We are hardly raising the same questions we asked about Electoral Bonds -- who is getting how much and for what purpose?

Last December, every ministry of the Union government proudly proclaimed its ‘achievements’ in 2023. The Commerce Ministry trumpeted about the Production-Linked Incentive (PLI) scheme, which has an outlay of Rs 1.64 lakh crore to, as the name indicates, encourage companies to produce stuff in this country. This money is said to be to help ramp up our manufacturers’ global competitiveness, attract investments in areas of core competence and cutting-edge technology, ensure efficiencies, create economies of scale, enhance exports and make India an integral part of the global supply chain.

So, on January 1, I filed an RTI application with the ministry seeking details of the 746 applications that had been approved for setting up manufactories across 24 states, with a total investment of Rs 95,000 crore. I also enquired about the names of the business entities to which incentives worth Rs 2,900 crore are said to have been distributed in 2022-23. I also sought related information such as district-wise data about the 6.4-lakh jobs that were supposedly created, details of the foreign investors whose applications were approved and of companies manufacturing white goods selected for support under PLI. I had asked for all this information to be uploaded on their website for everybody to see. After all, we have the right to know because it is our tax money that’s being given to these companies.

The Commerce Department transferred the RTI application to the Department of Industrial Policy and Promotion. They, in turn, transferred it to their sister department which promotes industry and internal trade (DPIIT). By the end of the month, DPIIT had sent the URLs (web addresses) to two press notes from 2021 and 2022 which only listed the companies that had been approved under PLI and the investment amount they had committed. A week later, they sent the list of the 14 PLI sectors and the implementing Union ministries. Till date, the other queries about who got how many crores as incentives and where have all the jobs been created remain sarkari secrets.

Readers may ask, what is my business with the PLI scheme? Well, when domestic corporates like Adani, Jindal, Wipro, Hindalco, Voltas, and Syska and foreign companies like LG, Daikin, Mitsubishi, Chengfeng Tech, etc., are incentivised with our money, don’t we all have the right to know? Should they not be answerable to us for what they have achieved with that money? Maybe they should be declared ‘public authorities’ under RTI since there is substantial government financing involved.