Social ,21 Apr 2025

India Set to Launch Electronics Component Scheme to Boost Manufacturing: Ashwini Vaishnaw

India is preparing to take another giant leap toward becoming a global electronics manufacturing hub. Union Minister for Electronics and IT, Ashwini Vaishnaw, recently announced that the government will soon launch a dedicated Electronics Component Scheme to enhance domestic production and reduce import dependency.

This move aligns with India’s ambitious “Make in India” and Atmanirbhar Bharat (Self-Reliant India) initiatives, as the nation intensifies its efforts to build a robust electronics ecosystem across the value chain.

 

What Did Vaishnaw Announce?

Speaking at an industry event, Minister Ashwini Vaishnaw emphasized the importance of building core competencies in electronics component manufacturing. He said:

“We are working on launching an electronics component scheme very soon. The scheme will focus on building the core layer of the electronics value chain in India, which will be vital for long-term sustainability.”

The minister also highlighted that while India has made significant progress in assembling electronic devices, the country still relies heavily on imports for critical components such as semiconductors, capacitors, resistors, ICs, and connectors.

 

Why Is a Component Scheme Needed?

India's electronics industry has grown rapidly, with smartphone and consumer electronics assembly flourishing due to existing schemes like PLI (Production Linked Incentive). However, nearly 65-70% of the components used in electronic goods are imported—mainly from China, Taiwan, and South Korea.

A dedicated scheme focusing on component-level manufacturing can:

1. Reduce supply chain vulnerabilities
2. Improve trade balances
3. Create high-skill jobs
4. Boost export competitiveness
5. Deepen the electronics manufacturing ecosystem

 

Likely Features of the Scheme

While the final details are yet to be officially released, industry experts expect the scheme to include:

Feature	Expected Details
Financial Incentives	Up to 25% capital subsidy on setting up units
Focus Areas	Passive & active components, power devices, sensors
Eligible Entities	Domestic manufacturers, JVs, global suppliers
Location Preference	Electronics Manufacturing Clusters (EMCs) & SEZs
R&D Support	Grants for technology innovation and testing labs

This could also be integrated with the Semicon India programme, where India is investing ₹76,000 crore to promote chip design and fabrication.

 

A Step Toward Electronics Self-Reliance

India’s electronics production was valued at around $105 billion in FY2023, but component production contributes only a fraction of that. The new scheme is expected to bridge this gap and contribute to the government’s goal of reaching $300 billion in electronics manufacturing by FY2026.

Additionally, this move comes at a time when geopolitical shifts are prompting global companies to explore “China Plus One” strategies. India is positioning itself as the natural alternative for electronics supply chains.

 

Industry Reactions

Rajeev Chandrasekhar, MoS for Electronics and IT, recently commented:

“For India to be globally competitive in electronics, we must localize the entire supply chain—including components and semiconductors. The component scheme is an essential piece of this strategy.”

Manish Sharma, Chair of FICCI Electronics Committee, said:

“This scheme will help attract global component suppliers and encourage domestic champions to invest in scalable manufacturing.”

 

Economic Impact: What to Expect

1. Boost to GDP:
   A stronger electronics ecosystem could significantly contribute to India’s GDP and export revenues.
2. Employment Creation:
   The scheme is expected to generate 50,000+ direct and indirect jobs, especially in tier-2 and tier-3 cities.
3. Technology Upgradation:
   With incentives for R&D and quality certification, the scheme could enhance India's technological capabilities.
4. Supply Chain Resilience:
   Local component production would reduce disruptions caused by global crises like pandemics or geopolitical conflicts.

 

What’s Next?

1. The scheme is likely to be announced officially in the next few months.
2. It could be tabled in the upcoming policy briefings or integrated into the Digital India vision for 2025.
3. Industry stakeholders are eagerly awaiting clarity on application guidelines, incentive structure, and implementation timelines.

 

Key Takeaways

1. India to launch an Electronics Component Scheme, as announced by Minister Ashwini Vaishnaw.
2. Aims to reduce import dependence and build a full-stack electronics manufacturing ecosystem.
3. Expected to include capital subsidies, R&D incentives, and support for passive and active components.
4. Complements India’s broader ambition to become a global electronics manufacturing hub.