New Delhi,  Centre on Friday selected 20 companies such as Tata Motors, Suzuki Motor Gujarat, Hyundai Motor India, Mahindra & Mahindra amongst others to become a part of 'Production Linked Incentive' (PLI) scheme for automobile and auto components.

Last year, Centre had approved the PLI scheme for enhancing the country's manufacturing capabilities for 'Advanced Automotive Products' (AAT) with a budgetary outlay of Rs 25,938 crore.

The AATs are vehicles which include types that are capable of running on hydrogen and electricity.

Accordingly, the scheme proposes financial incentives to boost domestic manufacturing of AAT products and attract investments in the automotive manufacturing value chain. Its prime objectives include overcoming cost disabilities, creating economies of scale and building a robust supply chain in areas of AAT products.

"A total of 115 companies had filed their application under the Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India which was notified on 23 September 2021," said the Ministry of Heavy Industries in a statement.

"Incentives are applicable under the scheme for determined sales of Advanced Automotive Technology (AAT) products (vehicles and components) manufactured in India from 1 April 2022 onwards for a period of 5 consecutive years."

According to the statement, the ministry processed the applications received under 'Champion OEM Incentive' scheme and 20 applicants have been approved under this category of the scheme. "Applications for Component Champion Incentive scheme are being processed separately."