New ₹23,000 Cr Scheme to Strengthen Core Manufacturing
VINOD BHAT
NEW DELHI, Mar 28: India’s electronics sector is witnessing historic growth, with a 5x increase in production over the last decade, reaching ₹9.5 lakh crore in 2024, at a compound annual growth rate (CAGR) of 17%. Similarly, electronics exports have seen a 6x surge, touching ₹2.4 lakh crore in 2024, with an impressive 43% CAGR. This rapid expansion has generated around 25 lakh jobs, and electronics items now rank among India’s top three export categories.
New Scheme to Boost Core Manufacturing
To further strengthen this momentum, the government has announced a ₹23,000 crore Electronics Manufacturing Components Scheme. This six-year scheme focuses on manufacturing sub-assemblies and bare components such as resistors, capacitors, and inductors, which are essential to complete India’s electronics manufacturing value chain. The initiative will not only cover passive components but also sub-assemblies used across sectors including power, medical, telecom, automobile, and consumer goods.
Objective: Building a Robust Value Chain
The scheme aims to deepen the electronics manufacturing ecosystem by:
Promoting the production of key components that are currently imported.
Ensuring India’s capability to manufacture high-quality sub-assemblies, thereby reducing import dependency.
Strengthening the supply chain to drive export-led growth across multiple sectors.
Key Expected Outcomes
The scheme is projected to deliver remarkable results, including:
₹59,350 crore in investments.
₹4.56 lakh crore in production output.
Creation of 1 lakh direct employment opportunities.
Three-Tier Incentive Structure
To maximize the impact of the scheme, the government has introduced a three-pronged incentive system:
Employment-linked Incentives: To encourage job creation across the value chain.
Capital Subsidy: To support high-capital expenditure segments with low turnover.
Production/Turnover-linked Incentives: To reward higher output and turnover.
Focus on Capital Goods for Electronics Manufacturing
In a bid to boost domestic manufacturing, the scheme also promotes the production of capital goods required for electronics manufacturing. Several cities, including Bengaluru, Pune, Rajkot, and Coimbatore, are emerging as key hubs in this segment. For instance, a Bengaluru-based company is developing high-precision magnetron equipment critical for electronics manufacturing.
Strengthening India’s Electronics Ecosystem
The government’s focus now extends beyond finished goods to cover core components, ensuring a comprehensive and self-reliant value chain. This move is expected to significantly boost India’s capabilities in electronics manufacturing and drive sustained economic growth through increased exports and industrial development.
With this ambitious scheme, India is set to strengthen its position as a global electronics manufacturing hub, furthering the vision of ‘Make in India, Make for the World.’
