Pitching ₹400 billion, MeitY now awaits Cabinet approval to fulfil its plan to boost India’s electronics component production, employment, higher local value, and a robust global supply chain.
The Ministry of Electronics and Information Technology (MeitY) is seeking the Union Cabinet’s approval for a financial package of ₹400 billion in December, aimed at promoting domestic production of electronic components, as reported by the Economic Times.
This financial initiative is expected to provide subsidies for both capital expenditure and operational purposes to prevent industry pushback, as seen in the previous IT hardware PLI scheme.
It is expected to stimulate job growth and establish a supportive environment for electronic component manufacturing.
This proposal, which excludes the semiconductor industry, could begin attracting investments by April 2025, provided the Cabinet approves it. According to the report, this move is part of the government’s broader goal to integrate Indian businesses into the global electronics supply chain.
India’s demand for electronic components is anticipated to grow from $45.5 billion in 2023 to $240 billion by 2030, based on a report from the Confederation of Indian Industry. The scheme is designed to raise the local value-added share in electronics manufacturing from the current 15-18% to 35-40% within five years, with a long-term goal of reaching 50%.
Discussions are underway to avoid delays in setting up manufacturing plants after the scheme’s launch, according to ET. The initiative is expected to attract ₹820 billion in investments and support component production worth ₹1.9-2 trillion, initially focusing on mobile phones and later expanding to IT hardware.
If approved in December, Indian companies will have 90 days to establish ties with customers and technology partners.
Industry representatives have called for faster approval of joint ventures with companies from Taiwan, South Korea, Japan, and China. The new scheme aims to boost local production of key components like PCBs, camera modules, and lithium-ion cells, which account for about 50% of mobile phone and laptop material costs. This initiative seeks to increase local value addition, despite progress under current PLI schemes.
