The Union Cabinet on Friday approved the much awaited Production Linked Incentive (PLI) scheme for electronics component manufacturing with an outlay of Rs 22,919 crore.
The scheme aims to attract investment of Rs 59,350 crore resulting in production of Rs 4,56,500 crore worth of products
The Union Cabinet on Friday approved the much awaited Production Linked Incentive (PLI) scheme for electronics component manufacturing with an outlay of Rs 22,919 crore.
The scheme aims to attract investment of Rs 59,350 crore resulting in production of Rs 4,56,500 crore worth of products, the government said in a statement. The scheme may create an additional direct employment of 91,600 and many indirect jobs as well.
“We need to come out of import substitution mindset and start manufacturing for us for the rest of the world,” Union Electronics and IT Minister Ashwini Vaishnaw said at a press conference in New Delhi.
The tenure of the scheme is six years with one year of gestation period. Payout of a part of the incentive is also linked with employment targets achievement, the statement said.
“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),” the statement added.
The scheme will be supporting production of sub-assemblies, bare components and supply chain ecosystem and capital equipment for electronics manufacturing.
Electronics is one of the highest-traded and fastest-growing industries globally and is expected to play a pivotal role in shaping the global economy and advancing a country's economic and technological development.
In the last few years, Indian electronics goods manufacturing sector has posted high growth. The domestic production of electronic goods has increased from Rs 1.90 lakh crore in FY15 to Rs 9.52 lakh crore in FY24 at a CAGR of more than 17%. The exports of electronic goods have also increased from Rs 0.38 lakh crore in FY15 to Rs 2.41 lakh crore in FY24 at a CAGR of more than 20%.
“The scheme provides differentiated incentives to Indian manufacturers tailored to overcome specific disabilities for various categories of components and sub-assemblies so that they can acquire technological capabilities and achieve economies of scale,” the government said in the statement.
The components manufactured will serve sectors such as telecom, consumer electronics, automobile, medical devices, power sector etc.