Production Linked Incentive (PLI) Scheme

The Union government launched the PLI scheme in 2020 to incentivize large-scale private sector investments in India.

Focus on Mobile Phones

• Significant growth seen in mobile phone exports, with figures exceeding Rs 25,000 crore in January, expected to reach Rs 1.8 lakh crore by fiscal year's end, a 40% increase from the previous year.
• Apple is a major contributor, accounting for 70% of all mobile phone shipments.
• Apple's contract manufacturers — Foxconn, Tata Electronics, and Pegatron — received 75% of all disbursements under the scheme from 2022-2025.

Challenges and Strategies

• Questions exist regarding the extent of value addition within the country.
• Government discussions noted low value addition across sectors, even successful ones under the PLI scheme.
• A policy for electronic components manufacturing aims to increase domestic value addition from 15-20% to 30-40%.

Target Areas and Investments

• Components targeted include display modules, camera modules, and printed circuit boards, among others.
• Total scheme outlay is approximately Rs 23,000 crore over six years, with incentives based on investment, production, and employment goals.

Expected Outcomes

• The scheme aims to create a larger domestic electronics ecosystem, deepening and broadening the manufacturing base.
• Projected to generate 91,600 direct jobs.

Global Context and Opportunities

Amid global geopolitical risks, tariff/trade wars, and supply chain restructuring, India has a unique opportunity to boost its manufacturing sector through strategic investments.