India is moving to strengthen the foundations of its rapidly expanding electronics manufacturing sector by shifting the focus from assembly-led growth towards domestic production of components, sub-assemblies, materials and related capital goods.
The Electronics Component Manufacturing Scheme (ECMS) is at the centre of this effort, with the government seeking to reduce import dependence, increase domestic value addition and build a more resilient electronics supply chain.
Electronics production in India has risen sharply over the past decade, increasing from ₹1.9 lakh crore in 2014–15 to ₹13.11 lakh crore in 2025–26. During the same period, electronics exports increased from more than ₹38,000 crore to ₹4.24 lakh crore.
The government now sees deeper domestic component manufacturing as the next major step in consolidating this growth and creating a globally competitive electronics ecosystem.
From electronics assembly to a deeper domestic value chain
Electronics have become essential to communication, healthcare, transportation, financial services, manufacturing and digital infrastructure. Smartphones, automobiles, telecom networks and industrial systems all depend on increasingly sophisticated electronic components.
However, several critical components and materials remain dependent on imports. These include printed circuit boards, camera and display modules, connectors, capacitors, lithium-ion cells and rare-earth magnets.
The ECMS is designed to address these gaps by supporting manufacturing across components, sub-assemblies, supply-chain products and related capital goods.
The objective is to build capabilities deeper within the electronics value chain so that India’s manufacturing growth is accompanied by greater domestic value addition and stronger supply-chain resilience.
ECMS expands from ₹22,919 crore to ₹40,000 crore
The Electronics Component Manufacturing Scheme was notified on April 8, 2025, with an initial outlay of ₹22,919 crore.
The scheme has a six-year tenure, with an optional one-year gestation period, while the capital expenditure incentive is available for five years.
The scale of the programme was subsequently expanded. The Union Budget 2026–27 increased the ECMS outlay to ₹40,000 crore, providing additional support for domestic electronics component manufacturing.
The scheme is already translating into projects on the ground. As of August 2026, 106 projects had been approved across 15 States, covering 30 electronic domain products and involving an approved investment of ₹69,548 crore.
Production has begun at 38 approved plants, while another 16 projects are at advanced stages of construction or machinery installation.
The approved projects are expected to generate ₹5.34 lakh crore in production and create 74,628 direct jobs and 2.5 lakh indirect jobs.
The government said ECMS is also expanding domestic capacity across critical electronics components and materials, with production capacity now meeting or exceeding domestic demand in several product categories.
Semiconductor ecosystem gets fresh momentum
Alongside component manufacturing, India is strengthening its semiconductor ecosystem as part of the broader strategy to build technological resilience and economic security.
The semiconductor push received renewed visibility with SEMICON India 2026, which was inaugurated by Prime Minister Narendra Modi at Yashobhoomi, New Delhi, on September 17.
Being held from September 17 to 19, the event is themed “Silicon to Systems: Building the Ecosystem” and brings together global industry leaders, policymakers, investors, academia and start-ups.
The event is intended to provide a platform for advancing India’s semiconductor ambitions and strengthening capabilities across the entire semiconductor value chain.
The government’s semiconductor strategy complements ECMS by supporting fabs, packaging, testing, chip design and related capabilities.
The ₹76,000-crore Semicon 1.0 programme established the broader policy framework for semiconductor and display manufacturing. In July 2026, the government approved Semicon 2.0 with an outlay of ₹1,27,500 crore, with the objective of scaling India’s semiconductor ecosystem and strengthening its position as a global hub.
Building on a wider policy architecture
The ECMS forms part of a wider set of initiatives aimed at developing India as a global electronics manufacturing hub.
The National Policy on Electronics 2019 (NPE 2019) established the overarching objective of positioning India as a global hub for Electronics System Design and Manufacturing (ESDM), including the development of core components and an enabling environment for competitive manufacturing.
The Production Linked Incentive (PLI) Scheme for Large Scale Electronics Manufacturing provides performance-linked incentives of 4%–6% on incremental sales for eligible target segments, with a focus on scaling domestic electronics and mobile manufacturing.
The Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS) provided a 25% capital expenditure incentive for electronic components, semiconductor and display fabrication, ATMP units, specialised sub-assemblies and capital goods.
Meanwhile, Modified Electronics Manufacturing Clusters (EMC 2.0) supports world-class manufacturing infrastructure, common facilities and plug-and-play capacity.
The government has also introduced the PLI Scheme for IT Hardware, with PLI 2.0 aimed at strengthening the manufacturing ecosystem, reducing import dependence and positioning India as a trusted global supply-chain hub.
Other supporting measures include the Electronics Manufacturing Clusters scheme, which provides financial assistance of up to 50% of project cost, subject to a ceiling of ₹50 crore for every 100 acres for greenfield projects.
The Phased Manufacturing Programme (PMP) provides a structured, tariff-based approach to increasing domestic value addition in cellular mobile phones and their key sub-assemblies.
The Electronics Development Fund (EDF), meanwhile, operates as a Fund of Funds, investing in venture funds to provide risk capital and promote market-driven innovation, product development and start-up growth in the ESDM and IT sectors.
Target of $500 billion electronics manufacturing by 2030
The government’s broader objective is to convert India’s growing electronics production base into a globally integrated manufacturing and export ecosystem.
As projects supported under ECMS move from approval to construction and commercial production, the scheme is expected to broaden India’s manufacturing base, increase domestic value addition and strengthen integration with global value chains.
With electronics already emerging as a major export category, India is targeting a $500 billion (₹47.75 lakh crore) domestic electronics manufacturing ecosystem and $150 billion (₹14.33 lakh crore) in electronics exports by 2030.
The ECMS, together with semiconductor, electronics manufacturing, IT hardware and investment-support programmes, is intended to provide the component-level foundation needed to achieve these targets.
The larger shift is from an electronics sector driven predominantly by assembly towards one supported by domestic components, materials, design, manufacturing infrastructure and semiconductor capabilities – creating the backbone for a more self-reliant and globally competitive Indian electronics industry.
