India Approves Electronics Component Manufacturing Scheme to Boost Self-Reliance
Photo Credit: @AshwiniVaishnaw
The Union Cabinet, led by Prime Minister Narendra Modi, has approved the Electronics Component Manufacturing Scheme with a funding of ₹22,919 crore. This initiative aims to strengthen India’s electronics supply chain by encouraging domestic and global investments, increasing domestic value addition (DVA), and integrating Indian manufacturers into Global Value Chains (GVCs).
Driving Investments and Employment
The scheme is expected to attract an investment of ₹59,350 crore, resulting in the production of ₹4,56,500 crore worth of electronic components. Additionally, it will generate 91,600 direct jobs, along with many indirect employment opportunities, significantly boosting India’s manufacturing and employment sectors.
Key Features of the Scheme
The scheme provides differentiated incentives tailored to address challenges in various categories of electronic components and sub-assemblies. The incentives include:
- Turnover-linked incentives for sub-assemblies such as display modules and camera modules.
- Hybrid incentives for high-density interconnect (HDI) PCBs and surface-mount device (SMD) passive components.
- Capital expenditure incentives for parts, components, and capital goods used in electronics manufacturing.
The scheme will be implemented over six years, with a one-year gestation period. A portion of the incentive payout will be linked to employment generation targets, ensuring sustainable job creation.
India’s Rising Electronics Manufacturing Sector
The electronics industry is one of the fastest-growing and most strategically significant sectors globally. Over the past decade, India has witnessed remarkable growth in electronics manufacturing, thanks to government initiatives such as Make in India and the Production-Linked Incentive (PLI) schemes.
- Domestic electronics production has increased from ₹1.90 lakh crore in FY 2014-15 to ₹9.52 lakh crore in FY 2023-24, growing at a CAGR of over 17%.
- Electronics exports have surged from ₹0.38 lakh crore in FY 2014-15 to ₹2.41 lakh crore in FY 2023-24, growing at a CAGR of over 20%.
This new Electronics Component Manufacturing Scheme is set to further accelerate India’s electronics industry, strengthen supply chain resilience, and position the country as a global electronics hub.
Source: PIB
