The Union Cabinet has approved a ₹22,919 crore scheme to enhance domestic electronics manufacturing, focusing on components and sub-assemblies. This initiative seeks to attract investments totaling ₹59,350 crore, aiming for a production output of ₹4,56,500 crore over six years. It is projected to create 91,600 direct jobs and numerous indirect employment opportunities.
Key features of the scheme
- Incentive structure: Unlike previous production-linked incentives, this scheme offers benefits based on both turnover and capital expenditure. A portion of the incentive is also tied to achieving specific employment targets.
- Target segments: The scheme encompasses sub-assemblies like display and camera modules, as well as bare components such as multi-layer printed circuit boards and lithium-ion cells (excluding those for storage and mobility). Enclosures for mobile devices, IT hardware, and related products are also included.
Sectors expected to benefit include electronics, telecommunications, consumer goods, medical devices, automotive, and power.
Union Electronics and IT Minister Ashwini Vaishnaw highlighted the momentum in electronics manufacturing over the past decade, noting a significant increase in domestic production from ₹1.9 lakh crore in 2014-15 to ₹9.52 lakh crore in 2023-24, reflecting a compound annual growth rate of over 17%. Exports have also risen from ₹0.38 lakh crore to ₹2.41 lakh crore during the same period, achieving a CAGR of more than 20%.
Industry leaders have welcomed the scheme, emphasizing its potential to enhance local value addition and attract further investments. They also highlighted the employment-linked incentives as a catalyst for workforce growth and economic development.
