Minister of Railways, Communications and Electronics & IT Ashwini Vaishnaw on Wednesday briefed press throughout India, through Video Link on the Cabinet Decision to offer 'Production Linked Incentive (PLI)' for IT Hardware manufacturing. He stated that after looking at the success of PLI in Mobile Phones, this step was taken.
He said that in the last 7 years, there has been change in mindset from 'import substitution' to 'export led growth'. He further said that now onwards, more than 90% components of IT Hardware and mobile phones would be manufactured in India, whereas a few years back they were imported. This will bring down the cost of production, and enable Indian manufacturers to produce Laptop, PC, Tablets etc at less cost.
1. Context:
• Electronics manufacturing in India has witnessed consistent growth with17% CAGR in last 8 years. This year it crossed a major benchmark in production – 105 billion USD (about Rs 9 lakh crore)
• India has become the world’s second largest manufacturer of mobile phones. Exports of mobile phones crossed a major milestone of 11 billion USD this year (about Rs 90 thousand crore)
• The global electronics manufacturing ecosystem is coming to India, and India is emerging as a major electronics manufacturing country
• Building on the success of Production Linked Incentive scheme (PLI) for mobile phones, the Union Cabinet today approved PLI for IT hardware
2. Salient features:
• PLI for IT hardware covers laptops, tablets, all-in-one PCs, servers and ultra-small form factor devices
• The budgetary outlay of the scheme is Rs. 17 thousand crores
• The tenure of this scheme is 6 years
• Expected incremental production is Rs. 3.35 Lakh Crores
• Expected incremental investment is Rs. 2,430 Crores
• Expected incremental direct employment is 75 thousand
3. Significance:
• India is emerging as a trusted supply chain partner for all global majors. Large IT hardware companies have shown keen interest in establishing manufacturing facilities in India. This is further supported by strong IT services industry having good demand within the country
• Most majors would like to supply domestic markets within India from a facility situated in India as well as make India an export hub
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