EY Urges Budget 2026 to Boost AI, Space Sectors With PLI Scheme

TECH

Overview

EY India has recommended the government extend its Production Linked Incentive (PLI) scheme to new technology sectors, including AI, space, and robotics, for the upcoming Union Budget 2026. The firm also suggests public infrastructure investments in these futuristic areas to stimulate private investment and drive innovation. EY emphasizes targeted incentives and tax certainty to attract domestic and foreign investors and shape India's economic trajectory.

EY's Budget 2026 Recommendations

EY India has advised the government to consider extending the Production Linked Incentive (PLI) scheme to emerging technology sectors like Artificial Intelligence (AI), space, and robotics in the upcoming Union Budget 2026. Sameer Gupta, national tax leader at EY India, stated that expanding the scheme would stimulate private investment.

Stimulating Investment in Futuristic Tech

Gupta further suggested that public infrastructure investments in advanced areas such as AI, Generative AI (GenAI), robotics, and space technology could induce significant private investment growth. EY emphasized that targeted incentives for these nascent industries are crucial for fostering innovation and attracting both domestic and foreign investors. Businesses are looking for a strong commitment to tax certainty and streamlined compliance processes.

Context of PLI Scheme

The PLI scheme, launched in 2020, aligns with the government's self-reliance policy. By November 2024, committed investments under the scheme had reached ₹1.61 lakh crore. In the previous budget, allocations saw substantial hikes for sectors like electronics and IT hardware, automobiles, and textiles, aiming to accelerate industrial growth. EY stressed the Union Budget 2026's role in shaping India's economic trajectory amidst global volatility, advocating a forward-thinking approach to reinforce investor confidence and catalyze private sector participation.

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