Overview of the Electronics Component Manufacturing Scheme

The government has announced a ₹22,919 crore scheme aimed at boosting the domestic manufacturing of electronics components including display and camera modules, non-surface mount devices, multi-layer printed circuit boards, and lithium-ion cells.

Objectives and Industry Impact

• The scheme aims to complete the trifecta of semiconductor manufacturing, semiconductor component manufacturing, and finished products like mobile phones and laptops.
• The diversity of the manufacturing ecosystem in India has significantly increased, with over 400 production units established.
• The country is transitioning from finished goods manufacturing to component manufacturing.

Growth in Electronics Production and Exports

• Electronics production and export, particularly for mobile phones, have experienced exponential growth over the last decade.
• Electronics production recorded a 17% compound annual growth rate (CAGR), while exports grew at a 20% CAGR.
• Electronics products, including mobile phones, experienced a 54% year-on-year growth, becoming top exports from India.

Incentive Structure

• Incentives will be based on turnover and capital expenditure (capex) for manufacturing target segment goods.
• Turnover-based incentives consider net incremental sales over a base year.
• Capex incentives require meeting investment thresholds and commencing commercial production.

Scheme Duration and Administration

• The scheme will run for six years with an optional one-year gestation period.
• Both greenfield and brownfield applications are accepted with separate applications needed for each product segment.
• A governing council chaired by the IT secretary, with representation from various governmental departments, will oversee the scheme.