New Delhi, Dec. 25 -- The government is mulling a significant ramp-up in funding for its flagship auto manufacturing incentive, with the upcoming Union Budget likely to nearly double allocations for the production linked incentive (PLI) scheme for automobiles and auto components to about Rs.5,500 crore in FY27 from Rs.2,800 crore this fiscal year, according to two people aware of the discussions. This will underscore policy continuity in India's electric vehicle (EV)-led transition, even as disbursals trail targets and newer automakers remain excluded.

A proposal to this effect has been submitted by the heavy industries ministry to the finance ministry for the PLI scheme that has a Rs.25,938 crore outlay over five years (FY25-29), and co...