Maruti Suzuki's Entry into EV PLI Scheme to Transform India's Automotive Landscape
In a significant development for India's electric vehicle (EV) sector, Maruti Suzuki India Ltd has been directly added to the list of companies eligible for incentives under the government's ambitious ₹25,000 crore Production-Linked Incentive (PLI) scheme for electric vehicles. This strategic move is poised to provide a substantial scale boost to local EV manufacturing and accelerate the country's transition to cleaner mobility solutions.
Government Approval and Market Impact
The Ministry of Heavy Industries updated the PLI beneficiary list on 27 January 2026, marking the first revision to the roster in four years. This inclusion comes after Maruti Suzuki completed the amalgamation of its subsidiary, Suzuki Motor Gujarat Private Ltd (SMGPL), into the parent company in December 2025. Previously, only the subsidiary operating the Hansalpur facility was mentioned in the list.
Industry experts emphasize that Maruti Suzuki's participation holds particular significance given its commanding approximately 40% share of India's passenger vehicle market. The company's entry into the PLI scheme is expected to improve utilization of the incentive outlay and advance the government's localization and clean fuel objectives.
PLI Scheme Utilization and Financial Implications
The PLI-Auto scheme, approved by the Union cabinet in 2021, began disbursals only in FY25. In its inaugural year, the government disbursed ₹322 crore against an allocation of ₹604 crore, followed by approximately ₹2,000 crore out of ₹2,800 crore in subsequent allocations. According to operational guidelines, the government planned to disburse ₹604 crore in the first year, ₹3,150 crore in the second year, ₹5,925 crore in the third year, ₹7,199 crore in the fourth year, and ₹9,060 crore in the fifth year through FY29.
A senior government official, speaking anonymously, noted: "Till now, a major company has not joined the PLI-Auto scheme. When Maruti Suzuki enters the scheme and begins claiming incentives, the disbursals will rise significantly, and could help reach the goal of disbursing the scheme's full outlay by the stipulated time."
Maruti Suzuki's EV Rollout Strategy
Maruti Suzuki began exports of its first electric vehicle, the eVitara, in August 2025, while domestic sales are scheduled to commence in the January–March quarter of the current financial year. The company's EVs are manufactured at the Hansalpur facility, and with the beginning of EV rollouts from this plant, Maruti undertook the amalgamation exercise to absorb the subsidiary into the parent company.
If found eligible under the scheme, automakers can claim incentives ranging from 8% to 18% of determined sales value, which can be crucial for profitability. Analysts at Motilal Oswal highlighted in a note from August 2025: "In exports, the e-Vitara is expected to be profitable at the Ebit level from Day 1 itself."
Structural Shift in India's EV Ecosystem
After the PLI scheme's launch in 2021, the government initially released a list of 82 companies eligible to apply for incentives. Of the 115 companies that originally applied, those meeting the scheme's 50% domestic value addition criteria are eligible to claim benefits. Rivals such as Tata Motors and Mahindra & Mahindra have already begun claiming incentives under the scheme.
Ashim Sharma, senior partner and group head at Nomura Research Institute, commented: "MSIL entering the EV segment certainly gives a big boost to India's EV story in terms of all aspects including the effectiveness, achievement against goals of schemes such as PLI."
The inclusion of India's largest carmaker in the EV PLI scheme represents a pivotal moment for the country's automotive industry. This development not only promises to enhance local manufacturing capabilities but also aligns with broader national objectives of reducing carbon emissions and promoting sustainable transportation alternatives.
