Eyeing to tackle a looming ₹21 trillion supply gap by 2030, ELCINA seeks ₹725 billion boost to power India’s electronics industry, especially non-semiconductor components and slash import dependence.
The Electronics Industries Association of India (ELCINA) has recently requested a financial support package of ₹725 billion (approximately US$8.57 billion) from the government to boost the local production of raw materials and reduce India’s dependency on imports. This initiative aims to address the growing demand-supply gap in the electronics sector.
Out of this, about US$2.14 billion has been called for capital expenditures to encourage industry growth and US$6.43 billion in production-linked incentives (PLI).
The oldest industry body in India’s electronics sector has predicted that the demand for inputs in the electronics industry will rise significantly. The deficit is projected to reach US$248 billion (around ₹21 trillion) by 2030. Imports will primarily fill this gap, as India aims to achieve US$500 billion in electronics production by then.
Furthermore, ELCINA believes that with government support for non-semiconductor components, the deficit could be reduced by US$146 billion (₹12.36 trillion), bringing the gap down to US$102 billion (₹8.63 trillion).
The Indian government is considering a comprehensive support package to enhance the production of vital non-semiconductor electronic components.
ELCINA’s request includes a wide range of components, such as miniature electronics, printed circuit boards, discrete semiconductors, active components, and metallic parts. As per the industry group, these components account for 60% of the cost of a finished electronic product.
According to a PTI report, Rajoo Goel, Secretary General of ELCINA, explained that unlike finished products, where factory output can increase up to 16 times the investment, the return on investment for electronic components is much lower, with factories typically generating only three times the invested capital.
As a result, high operational costs and long investment recovery periods deter expansion in this sector. To address this, ELCINA has requested financial backing. Goel also highlighted that non-semiconductor components represent 40% of the total product value, while semiconductors comprise the remaining 20%.
The government has already approved investments worth ₹1.52 trillion under the India Semiconductor Programme, but Goel believes that focusing on non-semiconductor components will drive further growth.
The proposed support could generate 5 million additional jobs by 2030, given the labour-intensive nature of the industry. ELCINA anticipates that such support will also attract US$36 billion in investments by 2030.
In 2022, non-semiconductor component production in India was valued at US$13 billion, a figure expected to rise to US$20.7 billion by 2026 and US$37 billion by 2030, if current trends continue. However, without sufficient support, this would lead to a deficit of US$248 billion by 2030.
