India will offer incentives of up to $5 billion to companies that locally manufacture components for devices ranging from mobile phones to laptops, to boost this emerging industry and reduce supplies from China.
India’s electronics production is expected to more than double over the past six years to reach $115 billion by 2024, thanks to growth in mobile device manufacturing by global companies such as Apple and Samsung. It is now the world’s fourth largest smartphone supplier. But the sector faces criticism for its heavy dependence on components imported from countries like China.
“The new plan will encourage the production of key components, such as printed circuit boards, that will enhance domestic value addition and deepen local supply chains for a variety of electronic products,” one of the two officials said.
The incentives are likely to be awarded under a new plan that will be launched within two or three months, said the officials, who requested anonymity because details of the plan have not yet been made public.
A total of between $4 billion and $5 billion in incentives is likely to be awarded to eligible global or local companies under the plan. The plan, formulated by India’s Ministry of Electronics, has identified incentivized components and is in its final stages.
The Finance Ministry will soon approve the final allocation of the scheme, the first official said, adding that sources expect it to be launched in the next 2-3 months. India’s Ministry of Electronics and Ministry of Finance did not immediately respond to requests for comment.
India aims to increase its electronics manufacturing to $500 billion by fiscal 2030, including component production worth $150 billion, according to Niti Aayog, the government’s top policy think tank.
According to an analysis by private think tank GTRI, India imported electronics, telecom and electrical equipment worth $89.8 billion in fiscal 2024, more than half of which were imported from China and Hong Kong.
“This plan comes at a time when it is important to boost component manufacturing, which will help us take electronics production to a global level,” said Pankaj Mohindru, director of the Indian Electronics and Cellular Association. .
