The Union Cabinet on Friday has approved the Electronics Component Manufacturing Scheme with a funding of Rs. 22,919 crore, aimed at making India self-reliant in the electronics supply chain. This initiative seeks to create a robust ecosystem by attracting large investments, both domestic and global, in electronics component manufacturing.
The scheme is projected to attract an investment of Rs. 59,350 crore, resulting in the production of Rs. 4,56,500 crore worth of products. It will also generate direct employment for 91,600 individuals, with additional indirect job opportunities.
The scheme provides differentiated incentives tailored to Indian manufacturers, helping them overcome specific challenges in various categories of components and sub-assemblies. These incentives are designed to help manufacturers acquire technological capabilities and achieve economies of scale. The target segments covered under the scheme include sub-assemblies like display and camera modules, bare components such as non-SMD passive components, electro-mechanicals, multi-layer printed circuit boards, and Li-ion cells, as well as selected bare components like high-density interconnect and SMD passive components. Capital expenditure incentives will also be provided for parts and components used in manufacturing these sub-assemblies and bare components.
The scheme’s tenure is six years, with one year of gestation, and a portion of the incentives will be linked to achieving employment generation targets.
The electronics industry is one of the fastest-growing sectors globally and plays a crucial role in shaping economies. The domestic production of electronic goods has increased from Rs. 1.90 lakh crore in FY 2014-15 to Rs. 9.52 lakh crore in FY 2023-24, growing at a compound annual growth rate (CAGR) of over 17%. Meanwhile, exports of electronic goods have surged from Rs. 0.38 lakh crore in FY 2014-15 to Rs. 2.41 lakh crore in FY 2023-24, reflecting a CAGR of more than 20%. This new scheme is expected to accelerate India’s growth in the electronics manufacturing industry and establish it as a global leader in the sector.