The Narendra Modi government’s productivity linked incentive scheme for IT hardware products such as laptops, tablets, PCs and servers has succeeded in attracting global giants like Dell, ICT (Wistron) and Foxconn as well as 10 Indian players to invest in the country’s electronics sector.
The companies approved under the new incentive scheme are expected to lead to a total production of more than Rs 1.61 lakh crore of IT hardware products in the next four years out of which exports are expected to be to the tune of Rs 60,000 crore as India gradually emerges as an electronics manufacturing hub.
These manufacturing ventures will bring in an additional investment of Rs 2, 517 crore and create a large number of jobs for youngsters graduating from the country’s engineering colleges and universities.
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With Communist China coming under a cloud both due to its belligerent foreign policy and dubious role in concealing crucial facts related to the Covid-19 pandemic, democratic India has emerged as an alternative destination for investors.
While smaller countries such as Vietnam are also getting fresh investments following the decoupling that is taking place of the western economies from China, India has a clear economic advantage due to its huge domestic market.
“Given the current global scenario, the world of manufacturing is undergoing a paradigm shift. Manufacturing companies across the globe are looking to diversify their manufacturing locations to mitigate the risk involved in depending on a single market,” according to the Ministry of Electronics and Information and Technology (MEITY).
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The productivity linked investment (PLI) scheme for IT Hardware which came into effect on March 3, 2021, extends an incentive of 2 to 4% on net incremental sales of goods that are manufactured in India to eligible companies for a period of four years.
The approvals for the 14 companies will generate additional direct employment opportunities of more than 36,000 in the next four years along with the creation of additional indirect employment of nearly 3 times the direct employment, according to a MEITY statement.
While giving approval to the companies, Electronics and IT Minister Ravi Shankar Prasad said the PLI scheme has been a huge success in terms of the applications received from global as well as domestic manufacturing companies.
“Industry has reposed its faith in India’s stellar progress as a world class manufacturing destination and this resonates strongly with PM’s clarion call of AtmaNirbhar Bharat – a self-reliant India,” the minister added.
He further said, “We are optimistic and looking forward to building a strong indigenous electronics manufacturing ecosystem across the value chain and integrating it with the global value chains.”
The foreign companies chosen under the scheme are: Dell, ICT (Wistron), Flextronics and Rising Stars Hi-Tech (Foxconn).
While the 10 domestic companies include Lava International Limited, Dixon Technologies (India) Limited, Infopower Technologies (JV of Sahasra and MiTAC), Bhagwati (Micromax) Neolync, Optiemus, Netweb, Smile Electronics, VVDN and Panache Digilife.
