Union Budget 2025-26: Finance Ministry clears ₹25,000-crore PLI scheme for electronic components

The Ministry of Finance has approved a Production Linked Incentive (PLI) scheme with an outlay of ₹25,000 crore for electronic components, CNBC-TV18 reported, citing people aware of the matter.

With the industry eyeing investments of over ₹40,000 to boost the sector, the Ministry of Electronics and Information Technology (MeitY) may consider increasing the outlay based on the scheme’s response, according to the report.

The scheme is expected to attract investments worth ₹40,000-₹45,000 crore, enabling growth in important electronic components like sub-assemblies of Printed Circuit Boards (PCBs), batteries, displays and camera modules.

The PLI scheme is a part of India’s plan to strengthen its manufacturing space, reducing its dependency on imports and aligning with the central government’s ‘Make in India’ mission.

"The new scheme will incentivise production of key components like printed circuit boards that will improve domestic value addition and deepen local supply chains for a range of electronics," a Reuters report published in November 2024 quoted an official privy to the matter.

In the last six years, India’s electronic production has more than doubled, hitting ₹115 billion in 2024. The country is one of the biggest smartphone suppliers in the world, holding the fourth position, with mobile manufacturing led by Apple and Samsung.

The PLI scheme is designed to boost both domestic and international investments, fostering job creation in the country’s manufacturing and related industries. By incentivising local production, the scheme can mitigate supply chain vulnerabilities, enhancing production capabilities and connecting Indian manufacturers with a thriving network of domestic suppliers and producers.

Steel sector PLI scheme

Another PLI scheme is set to be launched on Monday, January 6. Union Steel Minister H.D. Kumaraswamy is set to launch the ‘PLI Scheme 1.1’ for the steel industry, a government release said. The scheme aims to boost domestic production of speciality steel and reduce imports by attracting capital investments. Introduced earlier by the government, it has already drawn investments totalling ₹27,106 crore and created 14,760 direct jobs, with production estimated at 7.90 million tonnes of speciality steel. As of November 2024, companies have invested ₹18,300 crore and created over 8,660 jobs.