The Ministry of Electronics and Information Technology (MeitY) has come under scrutiny after informing the Parliament that it had to surrender Rs 1,574 crore from its Production-Linked Incentive (PLI) budget for fiscal year 2024 due to lower-than-expected output from beneficiary companies.

According to a report presented by the Parliamentary Standing Committee on Communications and Information Technology, the ministry had initially projected an expenditure of Rs 16,549 crore for various incentive schemes in FY24. This was later revised to Rs 14,421 crore. However, the actual utilisation stood at only Rs 12,847 crore—well below both estimates.

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Schemes Behind Fund Shortfall

MeitY informed the panel that a major chunk—about 70 per cent of the underutilised funds—pertained to the PLI and the Modified Programme for Development of Semiconductors and Display Manufacturing Ecosystem. The ministry attributed the shortfall to the performance of private firms selected under these schemes, asserting that disbursement of incentives is directly tied to what these firms manage to deliver. “It is beyond the ministry’s control to ensure complete utilisation of the allocated budget,” MeitY said in its submission.

Ministry’s Justification Not Accepted 

The committee, however, rejected MeitY’s explanation, stating that the ministry cannot shift full responsibility onto private players. The report expressed dissatisfaction with the ministry’s rationale, saying, “The ministry has a larger role and responsibility towards proper monitoring, facilitation, and effective implementation of these schemes, which cannot be solely left to private companies. Therefore, the ministry’s submission is not understandable.”

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Committee Urges Stronger Oversight 

Highlighting a lack of adequate effort, the committee recommended that MeitY conduct immediate reviews to identify and address any shortcomings in fund utilisation. It suggested that better coordination with stakeholders and companies through regular meetings could help ensure more realistic projections and effective disbursement in the future.