Cabinet approves ₹22,919-crore PLI scheme for electronics component manufacturing

The Union Cabinet, chaired by Prime Minister Narendra Modi, on Thursday approved the Electronics Component Manufacturing Scheme with a financial outlay of ₹22,919 crore.

The scheme is designed to attract large-scale global and domestic investments into the electronics components ecosystem, enhance domestic value addition through capacity and capability development, and integrate Indian companies with global value chains.

"This scheme aims to develop a robust component ecosystem by attracting large investments (global/domestic) in electronics component manufacturing ecosystem, increasing Domestic Value Addition (DVA) by developing capacity and capabilities, and integrating Indian companies with Global Value Chains (GVCs)," a government release said.

The Electronics Component Manufacturing Scheme is expected to draw an investment of ₹59,350 crore, generate production worth ₹4,56,500 crore, and create 91,600 direct jobs, along with numerous indirect employment opportunities.

It offers differentiated incentives tailored to address specific challenges faced by Indian manufacturers across various component categories and sub-assemblies.

The incentives are designed to help manufacturers acquire advanced technological capabilities and achieve economies of scale.

The scheme will run for six years, including a one-year gestation period, with a portion of the incentives tied to achieving employment targets.

The announcement comes against the backdrop of the electronics sector's rapid global growth and its critical role in economic and technological advancement.

Domestic production of electronic goods has surged from ₹1.90 lakh crore in FY 2014-15 to ₹9.52 lakh crore in FY 2023-24, a compound annual growth rate (CAGR) of over 17%. Exports have also risen sharply, from ₹0.38 lakh crore to ₹2.41 lakh crore over the same period, with a CAGR exceeding 20%.