The electronics manufacturing industry is urging the government to implement a US$ 3.61- US$ 4.21 billion (Rs. 30,000 to Rs. 35,000 crore) production-linked incentive (PLI) scheme for components and sub-assemblies, alongside capital expenditure support to boost mobile phone and electronics exports. The India Cellular & Electronics Association (ICEA), representing top smartphone brands and manufacturers, emphasized the necessity of this scheme to meet the projected demand for electronic components, expected to reach US$ 75- US$ 80 billion by 2026 and US$ 300 billion by 2032. This initiative aims to increase domestic value addition in mobile phone manufacturing from 18% to 35-40%. It should align with the development of the semiconductor ecosystem in India.
In its submission to the Ministry of Electronics and Information Technology, the industry proposed a 4-6% incentive structure for manufacturing sub-assemblies, high-end printed circuit boards, and other components. ICEA recommended an 8-year PLI plan with the flexibility to claim incentives for 6 years. Companies investing US$ 120.3 million (Rs. 1,000 crore) or more in SMD passive components, lithium-ion cells, and high-end PCBs should receive 40% capex support and an average incentive of 5% over 6 years. ICEA noted that the component ecosystem would take 2-3 years to begin commercial production, eventually meeting 5-10% of global demand within 6-7 years. They also suggested that supply chain ancillary units receive 25% capex support and critical sub-assemblies and components receive a 4-6% incentive for incremental sales.
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