A total of 19 companies—including Dell, ICT (Wistron), Flextronics, Rising Stars Hi-Tech (Foxconn), and Lava—have filed their application under India's Production Linked Incentive Scheme (PLI) for IT Hardware.
A total of 19 companies—including Dell, ICT (Wistron), Flextronics, Rising Stars Hi-Tech (Foxconn), and Lava—have filed their application under India’s Production Linked Incentive (PLI) Scheme for IT Hardware.
The remaining 14 companies have filed applications under the category Domestic Companies. They include Dixon, Infopower (JV of Sahasra and MiTAC), Bhagwati (Micromax), Syrma, Orbic, Neolync, Optiemus, Netweb, VVDN, Smile Electronics, Panache Digilife, HLBS, RDP Workstations, and Coconics. They companies are expected to expand their manufacturing operations in a significant manner and grow into national champion companies in IT hardware production.
The PLI Scheme extends an incentive of 4% to 2%/ 1% on net incremental sales (over base year of FY 2019-20) of goods under target segments that are manufactured in India to eligible companies, for a period of four years (FY 2021-22 to FY 2024-25).
In his address marking the conclusion of the application window under the scheme, Shri Ravi Shankar Prasad, Union Minister for Electronics & IT, Communications, Law and Justice said that the PLI scheme has been a huge success in terms of the applications received from global as well as domestic companies engaged in manufacturing electronics hardware products.
“The industry has reposed its faith in India’s stellar progress as a world class manufacturing destination, and this resonates strongly with Prime Minister’s clarion call of AtmaNirbhar Bharat—a self-reliant India,” he said. “We are optimistic and looking forward to building a strong ecosystem across the value chain and integrating with the global value chains, thereby strengthening electronics manufacturing ecosystem in the country.”
Under the leadership of Prime Minister Shri Narendra Modi and his visionary initiatives like the “Digital India” and “Make in India” programs, India has witnessed an unprecedented growth in electronics manufacturing in the past five years. The National Policy on Electronics 2019 envisions positioning India as a global hub for electronics system design and manufacturing (ESDM) by focusing on size and scale, promoting exports and enhancing domestic value addition by creating an enabling environment for the industry to compete globally.
After the success of the PLI Scheme in bringing investments in mobile phone (handsets and components) manufacturing, the Union Cabinet chaired by Prime Minister Modi has approved the PLI Scheme for IT hardware products. The target IT hardware segments under the proposed scheme include laptops, tablets, all-in-one personal computers (PCs), and servers. The scheme proposes production linked incentives to boost domestic manufacturing and attract large investments in the value chain of these IT hardware products.
Over the next four years, the scheme is expected to lead to total production of about INR1,60,000 crore. Out of the total production, IT hardware companies have proposed a production of over INR1,35,000 crore, and domestic companies have proposed a production of over INR25,000 crore.
The scheme is expected to promote exports significantly. Out of the total production of INR1,60,000 crore in the next four years, more than 37% will be contributed by exports of the order of INR60,000 crore.
The scheme will bring additional investment in electronics manufacturing to the tune of INR2,350 crore.
The scheme will generate approximately 37,500 direct employment opportunities in next four years, along with the creation of additional indirect employment of nearly three times the direct employment.
Domestic value addition is expected to grow from the current 5-12% to 16-35%.
With the demand for electronics in India expected to grow manifold by 2025, the Union Minister expressed confidence that the PLI scheme and other initiatives to promote electronics manufacturing will help in making India a competitive destination for electronics manufacturing and give boost to AtmaNirbhar Bharat. Creation of domestic champion companies in electronics manufacturing under the scheme is expected to stimulate local manufacturing for a global scale.