70 Applications Submitted for Program to Manufacture Electronic Components

Electronics Parts Production Program

It is a scheme worth Rs.22,919 crore, aimed at creating a strong component ecosystem by;

Drawing significant investments (both global and domestic) into the electronics component manufacturing ecosystem,

Enhancing Domestic Value Addition (DVA) through the development of skills and capacities, and

Incorporating Indian firms into Global Value Chains (GVCs).

Key Highlights of the Program:

The program offers varied incentives to Indian producers designed to address particular challenges for different types of components and sub-assemblies, enabling them to develop technological skills and reach economies of scale.

The duration of the program is six years, including a one-year gestation phase.

A portion of the incentive payout is tied to the achievement of employment targets.

Classification of Components within the Framework

• Category A: Display components, camera module subassemblies.
• Category B: Basic parts such as non-surface mount components, multi-layer PCBs, lithium-ion batteries, and IT hardware items.
• Category C: Flexible printed circuit boards, surface-mount passive elements.
• Category D: Equipment and parts utilized in the production of A, B, and C.

Advancements in India's electronics industry

The local output of electronic products has risen from Rs.1.90 lakh crore in FY 2014-15 to Rs.9.52 lakh crore in FY 2023-24, achieving a CAGR of over 17%.

The export of electronic products has risen from Rs.0.38 lakh crore in FY 2014-15 to Rs.2.41 lakh crore in FY 2023-24, growing at a CAGR of over 20%.

Difficulties in the electronics industry

Market Rivalry: The worldwide electronics industry is led by nations such as China, Taiwan, the USA, South Korea, Vietnam, and Malaysia.

Technical Skills: There is an insufficient number of properly trained technical staff for sophisticated manufacturing procedures.

Capital-intensive industry: Electronic manufacturing is a sophisticated and technology-driven field that necessitates substantial capital investments, entails high risk, has prolonged development and return timelines, and demands significant and ongoing financial commitments.

Government programs

Make in India, Digital India, and Startup India are encouraging local production and technological creativity.

Production Linked Incentive Scheme (PLI): This initiative seeks to draw significant investments into the manufacturing of mobile phones and designated electronic components, which encompass Assembly, Testing, Marking, and Packaging (ATMP) facilities.

National Policy on Electronics 2019 (NPE 2019): It serves as an inclusive framework aimed at establishing India as a worldwide center for electronics production.

Modified Electronics Manufacturing Clusters (EMC 2.0) creates infrastructure featuring shared facilities and industrial hubs for electronics manufacturing.

Path Forward

India aims to reach a target of 500 billion USD in the value of electronics manufacturing by the year 2030.

To improve competitiveness, India must localize advanced components, bolster design capabilities via R&D funding, and form strategic alliances with international technology leaders.