Bicycle industry demands incentive boost from Modi 3.0 to push exports

Vijay C Roy

Chandigarh, June 13

As Prime Minister Narendra Modi embarked on his third term, the labour-intensive bicycle industry is eagerly waiting for extension of Production-Linked Incentive Scheme (PLI) to boost exports especially from Punjab as the state is frontrunner in bicycle manufacturing.

Ludhiana accounts for 75% of the country’s total bicycle production and 92% of bicycle parts’ manufacturing. The city manufactures more than 60,000 bicycles every day.

“The Production-Linked Incentive (PLI) scheme for bicycles, along with toys and leather, is under consideration by the Prime Minister’s Office (PMO) and the Union Cabinet. We hope that the government will extend it to bicycle industry soon,” said Jagdish Rai Singhal, founder of Ludhiana-based Eastman Group of Industries.

Bicycle exports witnessed decline in the last fiscal year. The total bicycle exports from the country was 436,720 units in 2023-24 compared to 557,523 units in 2022-23, according to All India Cycle Manufacturers Association (ACMA) data.

“We have a disadvantage that quality and design of bicycles, which India can cater to export market especially Europe, requires components and accessories which needs to be developed in India but the development cost is too high. Hence, the PLI scheme is essential,” Singhal said while justifying the need of PLI.

The manufacturers said they have a disadvantage due to high inland freight from Ludhiana to Mundra Port in Gujarat that amounts in range of 10% to 15% cost per bicycle, and there was additional 10.5% import duty on bicycles imported from India to Europe.

“The freight and the import duty combined, makes India bicycle 25% expensive than the other Asian countries such Sri Lanka, Bangladesh, The Philippines, Cambodia, where the factories are situated in range of 30 to 100 km from port and import duty to Europe is 0%. The government can develop a scheme, which helps ‘Make in India’ to be competitive,” Singhal said.