The Indian government is set to unveil a Production-Linked Incentive (PLI) scheme worth ₹25,000 crore for electronic components, as per reports from CNBC-TV18 on January 6. The Finance Ministry has already approved the proposal, and the Ministry of Electronics and Information Technology (MeitY) is expected to seek Cabinet approval. The announcement could be part of the Union Budget 2025.
The aim is to encourage locally made goods rather than relying heavily on imports, particularly from China. In addition, top priority will be accorded to a few of the critical electronic sub-assemblies that would serve to upgrade domestic value addition and strengthen the supply chain locally in critical areas: for example, printed circuit boards (PCBs), camera modules, batteries, and display units.
Although the industry had sought a higher outlay of ₹40,000 crore, the approved ₹25,000 crore PLI scheme is expected to give significant incentives for local production. In November 2024, government officials said the scheme would have the effect of deepening India’s electronics manufacturing ecosystem by encouraging companies to produce critical components locally.
In six short years, electronic production in the country has more than doubled, to $115 billion in 2024, powered by the expansion of giants such as Apple and Samsung. Today, the country is the world’s number four supplier of smartphones.
The proposed PLI will attract considerable interest and investment from domestic players and global original equipment manufacturers, leading to job creation and making India strong in the whole value chain linked to electronics globally. The scheme would help reduce dependence on supply-chain risks and accelerate innovation, further easing the integration of Indian factories into a forthcoming ecosystem of the component supplier base in the country.
Once implemented, the scheme will improve the production capacities and export competitiveness, with a corresponding reduction in imports, thus giving a strong fillip to the dream of India as a global manufacturing hub.
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Source: Moneycontrol
News Desk
