The Union Cabinet on Friday approved the production-linked incentive (PLI) scheme for non-semiconductor electronics components of Rs 22,919 crore to build indigenous capacity in the electronics supply chain.
PLI scheme for non-semiconductor electronics components
The scheme envisions drawing an investment of ₹59,350 crore, resulting in the production of ₹4,56,500 crore and generating additional direct employment of 91,600 citizens and creating many indirect jobs during its tenure of six years.
Electronics, telecom, consumer, medical devices, automobile and power sectors are expected to benefit from the scheme.
In this scheme, incentives will be based on turnover and capital expenditure, with a payout of a part of the incentive also linked to the employment target.
Union Minister of Electronics and Information Technology Ashwini Vaishnaw said there has been a strong momentum in electronics manufacturing in the last decade.
“We are making very good progress in the semiconductor part of the value chain. We have achieved good success with PLI based finished products manufacturing. Now we are covering subassemblies and bare components,” Vaishaw added.
The domestic production of electronic goods has surged from ₹1.9 lakh crore in 2014-15 to ₹9.52 lakh crore in 2023-24 at a compounded annual growth rate (CAGR) above 17 per cent.
The exports of electronic goods have also risen from ₹0.38 lakh crore in 2014-15 to ₹2.41 lakh crore in 2023-24 at a CAGR of more than 20 per cent.
“The focus must shift from import substitution to export-led growth,” the Minister said.
Ajai Chowdhry, founder, HCL and chairman, EPIC Foundation, said, “We have been requesting this for a long time. This will enable much higher value addition in the country for electronics manufacturing and will attract more investments in system products, as local availability will enable just-in-time manufacturing. Also this will enable more companies and start-ups to design and make products to enable India to be an electronics product nation.”
“Moreover, this scheme has an employment linked incentive which will further promote employment growth, workforce competitiveness and economic development,” he said.
“India continued to import PCB’s (printed circuit boards), passive components (such as capacitors, inductors, resistors), display modules that constituted 15-20 per cent of the bill of material of the electronic products in addition to semiconductors,” said Ashok Chandak, president, India Electronics and Semiconductor Association.
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