India approves $2.7B plan to boost electronics manufacturing
The scheme seeks to incentivize local manufacturing of electronics components in India, setting goals for domestic and foreign entities to establish local facilities at subsidies of up to 50% of the project costs.
The Indian cabinet has approved an INR 229 billion (about USD 2.7 billion) scheme to bolster electronics components manufacturing.
The plan, which will enhance production of electrical components used in sectors like telecoms, automobiles, consumer electronics and power, aims to add 92,000 direct jobs, a government statement said.
According to government data, electronics production jumped five-fold in India and exports grew six-fold from 2014/15 to 2023/24.
The new plan seeks to incentivize local manufacturing of electronics components in India, setting goals for domestic and foreign entities to establish local component manufacturing facilities at subsidies of up to 50% of the project costs, according to a report by Mint,
The areas of focus include sub-assembling display and camera modules, printed circuit boards, lithium-ion battery cells, and enclosures for mobile and electronics hardware.
“Within 10 years of manufacturing, we have reached 20% value addition. Now, we must target doubling this in the next five years by manufacturing both passive and active components,” India’s Electronics and Information Technology Minister Ashwini Vaishnaw said. “Active components will come through the semiconductor mission, and passive will come with the electronics components scheme.”
The scheme is also looking to localize the making of components and capital goods that will be used in the manufacturing processes, for which the central government will offer a capital expenditure-based incentive scheme, the Mint report said.
“The scheme provides targeted incentives for passives, SMD and Non-SMD, and the component ecosystem at large, fostering advanced component manufacturing,” said Electronic Industries Association of India (Elcina) secretary general Rajoo Goel, according to a report by the Economic Times. “This initiative fills a long-standing void in the supply chain and will strengthen the domestic ecosystem, improving our global competitiveness.”
