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ELECTRONICS SYSTEM DESIGN &MANUFACTURINGJune 2021July 2021For updated information, please visit www.ibef.orgFor updated information, please visit www.ibef.org
Table of Contents2Executive Summary3Advantage India4Market Overview6Growth Drivers13Key Trends and Developments22Key Industry Contacts30Appendix32
Executive summary India has witnessed a substantial spike in the demand of electronicproducts in the last few years; this is mainly attributed to India’sposition as the second-largest mobile phone manufacturer globallyand surge in the internet penetration rate. The Electronics System Design & Manufacturing (ESDM) market inIndia is anticipated to increase at a CAGR of 16.1% between 2019and 2025, owing to strong demand, supportive government policiesand increased digitalisation. The ESDM sector plays a key role in the government’s goal ofgenerating US 1 trillion of economic value from the digital economyby 2025. The Government of India attributes high priority to electronicshardware manufacturing as it is an important pillar of Make in India,Digital India and Start-up India programmes.Electronics Market in India (US billion)600540500400CAGR14 %300215200145100FY16FY19FY25Electronics System Design & Manufacturing (ESDM) Market inIndia (US billion) Factors such as expanding end-user base, promising start-upecosystem, strong policy support and rising FDI inflows are drivingthe ESDM sector.250 India’s exports of electronic goods were valued at US 11.7 billion inFY21.150 In May 2021, exports of electronic goods were valued at US 950.17million.CAGR16.6 %CAGR16.1 %220200CAGR15.1 %901005950FY16Source: Sutherland Research, India Electronics & Semiconductor Association (IESA)3FY19FY25
Advantage India4
Advantage India2. ATTRACTIVE OPPORTUNITIES3. POLICY SUPPORT One of the top three global economies in terms of number of The production-linked incentive (PLI) schemes will provide companiesdigital consumers.opportunities to establish manufacturing plants in India. Addressable market for domestic OEMs is projected to be Rs. 100% FDI is allowed under the automatic route. In case of electronics10 lakh crore (US 131.99 billion) by 2025.items for defence, FDI up to 49% is allowed under automatic route and The government intends to incentivise and attract investments tobeyond 49%, government approval is required.set up semiconductor FABs (fabrication plants) in India. Incentive rates for electronic products export under proposed Remission PLI scheme for large-scale electronics manufacturing and ITof Duties or Taxes on Export Products (RoDTEP) scheme.hardware to promote mobile phones and componentmanufacturing. Under the PLI scheme for IT Hardware, the approved enterprises areestimated to manufacture equipment worth US 21.62 billion over thenext four years. Of the total production, foreign companies havesuggested production worth US 11.38 billion, whereas domesticenterprises have planned a production of US 10.20 billion.1. ROBUST DEMAND Large consumer base.manufacturerofSecond-largestmobile phones in the world.One of the largest consumers ofelectronic products in Asia-Pacific.Third-largest start-up hub, coupledwith strong research & development(R&D) ecosystem.Bengaluru has been ranked amongthe world's top 50 start-up cities in2021.4. INVESTMENTS231Source: Sutherland Research, Ministry of Electronics and Information Technology (MeitY) Union Budget 2021-2254 The government has set a target toget Rs. 18,000 crore (US 2.4billion)investmentsintheelectronics manufacturing segmentby 2021-22. New schemes, as a part of theNational Policy on Electronics(NPE) 2019, outlay to spend US 6.7 billion in form of incentives. In July 2021, C4V, a lithium-ion cellmanufacturer in the US, invested US 537.15 million in the electricbattery manufacturing sector inKarnataka.
Market Overview6
Major product segmentsElectronics Market*Electronic Systems olUnitGigabitPassiveOpticalNetworks(GPON)*The Electronics Market includes (Total Domestic Consumption Exports) Electronics Design Market Electronics Manufacturing Services Market Electronics Component Market**The Electronics System Design & Manufacturing (ESDM) industry includes electronic hardware products and components relating to informationtechnology (IT), office automation, telecom, consumer electronics, aviation, aerospace, defence, solar photovoltaic, nano electronics and medicalelectronics. The industry also includes design-related activities such as product designing, chip designing, very large-scale integration (VLSI), boarddesigning and embedded systemsNote: The top eight product segments by value have been considered for the purpose of market sizing7
Overview of electronics market in India.(1/2)Electronics imports in India (FY20) (US billion)Electronics Market in India (US billion)600540CAGR16.6 %180160145250200215CAGR14 %3903403002904001002.8460500China &Hong 0FY16FY17FY18FY19FY20F FY21F FY22F FY23F FY24F FY25F The electronics market has grown at a CAGR of 14% from 2016-19 and is expected to accelerate at a CAGR of 16.6% in 2020-25, with the totaldemand likely to account for US 540 in FY25. In FY20, imports accounted for US 50 billion, wherein China and Hong Kong accounted for US 28 billion, or 57% of India’s total electronicimports. In FY21, export of electronics components stood at US 2.43 billion. According to the IESA (India Electronics & Semiconductor Association), more than 90% semiconductor companies globally have their R&Dcentres in India. The semiconductor R&D generates about US 2.5 billion in revenue and 6 lakh jobs in India.Source: India Electronics & Semiconductor Association (IESA)8
Overview of electronics market in India.(2/2) Fujitsu, a Japanese IT hardware manufacturer, announced its forayinto the Indian consumer laptop market in July 2021, with plans tosell 10,000 premium notebooks in the country by March 2022.Note: EoDB - Ease of Doing BusinessSource: News Articles, Union Budget 1,770.61,0001,703.81,5001,645.1 The ESDM sector is likely to generate US 100-130 billion ineconomic value by 2025.3,0001,565.8 India has been one of the largest consumers of electronic productsspecifically in Asia-Pacific due to factors such as rising per capitadisposable incomes and consumption in the past decade.3,5001,540.5 The key government initiatives such as ‘Make in India’ and ‘DigitalIndia’ improved the country’s EoDB. In 2021-22, the total budgetallocation towards the ‘Digital India’ programme is Rs. 6,806.33 crore(US 936.19 million).4,000863.5 The electronics manufacturing services industry in India is projectedto reach US 152 billion by 2025.Per Capita Disposable Income and Consumption Expenditure(US )1,574.9 As per Union Budget 2021-22, the Ministry of Electronics andInformation Technology (MeitY) has been allocated Rs. 9,720.66crore (US 1.33 billion). In the allocated budget, revenue expenditureallocation is Rs. 9,274.66 crore (US 1.27 billion) and capitalexpenditure allocation is Rs. 446 crore (US 61.34 million).201720180Per Capita Gross Disposable IncomePer Capita Private Consumption Expenditure
Overview of electronics system design & manufacturing(ESDM) market in India.(1/2)Segmentation of ESDM Market (FY19)ESDM Market Demand (US billion)250220CAGR16.1 %5059907814012010068CAGR15.1 %10515022%160190200Electronics SystemElectronics Design78%0FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 The Electronics System Design & Manufacturing (ESDM) is broadly segregated into—Electronics System and Electronics Design. With a spike in demand for electronic products, the ESDM sector in India is predicted to reach US 220 billion by 2025, rising at a 16.1% CAGRbetween 2019 and 2025. To support the ESDM sector and its growth trajectory, the Government of India (GoI) made electronics production an important pillar of keyinitiatives such as Make in India, Digital India and Start-up India. The ESDM sector plays a vital role in the government’s goal of generating US 1 trillion of economic value from digital economy by 2025.Source: India Electronics & Semiconductor Association (IESA)10
Overview of electronics system design & manufacturing(ESDM) market in India.(2/2)Electronics Design Market (US billion)Electronics System Market (US billion)70060504230CAGR15.4 %201020351184030905024615340466070CAGR15 %80801001051206020140140CAGR20.9 %1716016015CAGR14.8 %131800FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Electronics system market is expected to witness 2.3x demand of its current size (FY19) to reach US 160 billion by FY25. Electronics design segment, growing at 20.1%, accounted for 22% of ESDM market size in FY19; it is anticipated to be 27% of the ESDM market size inFY25. At present, most demand for semiconductors is being met through imports from countries such as the US, Japan and Taiwan. To reduce thisdependency on imports, the government is boosting electronics manufacturing clusters (EMCs) throughout the country to provide world-classinfrastructure and facilities. Owing to the ongoing pandemic, digital transformation is taking place at an accelerated rate and is laying the foundation for a digitally-enabled Indiapost COVID-19. Rising income levels and increased customer preference for in-vehicle digital experiences are likely to propel India's automotive electronics industry toUS 18 billion by 2027, with a CAGR of 17%.Source: India Electronics & Semiconductor Association (IESA)11
ESDM landscape in India - key players & clustersNCR ǀ GurugramNCR ǀ Noida, Greater NoidaMaharashtra ǀ PuneTelangana ǀ HyderabadKarnataka ǀ Bengaluru, MysuruAndhra Pradesh ǀ SriCity, TirupatiTamil Nadu ǀ ChennaiTamil Nadu ǀ SriperumbudurSource: Invest India12
Growth DriversGROWTH DRIVERS13
Growth drivers1POLICIES Policy support to promoteelectronics manufacturing. Initiatives such as ‘Make inIndia’ and ‘Digital India’. Skill development initiatives.142DEMAND-SIDE DRIVERS Large consumer base. Rollout of 5G, and industrialuse of Internet of Things (IoT)technology.3INVESTMENT Increasing FDI inflows. Third-largeststart-upecosystem. Robustresearch&development(R&D)ecosystem.
The third-largest start-up ecosystemSector-wise Share (%) of Start-ups, 2020% Share of Start-ups by Technology, ed Economy33.3%4.8%LogisticsArtificial Intelligence33.3%5.1%On-Demand DeliveryNew Energy9.5%EdTech9.5%14.3%9.5%Big DataCommunication ng10.3%12.8%10.3%New EnergyOthers According to Hurun Global Unicorn List 2020, with 21 unicorns, India emerged as the fourth-largest ecosystem for start-ups, following the US,China and the UK. To further boost this ecosystem, IESA has set an ambitious target (in 2018/19) of incubating 100 start-ups, creating 1,000 IPRs, generatingbusiness worth US 0.14 billion (Rs. 1,000 crore) and creating 1 million jobs over next five years. By 2030, ADIF, a think tank for IT start-ups, aims to make India's start-up ecosystem one of the top three in the world, with an emphasis onexpanding the knowledge base, encouraging collaboration and determining the best policies.Notes: IPR - Intellectual Property RightsSource: Sutherland Research, NASSCOM15
Bangalore, Delhi-NCR and Mumbai are home to 55-58% startups20-21% ǀ Delhi-NCR12-13% ǀ Mumbai42-45% ǀ OthersSource: NASSCOM1623-24% ǀ Bangalore
Large consumer base India emerged as the second-largest manufacturer of mobile phonesin the world, with production value of mobile devices reaching US 30billion in 2019-20 from US 3 billion in 2014-15. In addition, the consumer electronics and appliances industry in Indiais expected to become the fifth largest in the world by 2025; this isnoticeable for LCD/LED TVs, which witnessed more than 2x growth(by volume) in the past five years. Factors such as high internet penetration rate (over 718 millionusers) and second-largest global smartphone manufacturer boostedpenetration of electronic products to the large potential consumerbase, which in turn is driving ESDM market. Smartphone shipments in India increased by 23% YoY to reach 38million units in the first quarter of 2020, driven by new productlaunches and delayed demand from 2020. Xiaomi led the Indiansmartphone market with 26% shipping, followed by Samsung at 20%.India’s Smartphone Shipments (million)4035302520151050 In 2021, India's smartphone market is expected to rebound to 1221%, after two years of muted sales. In India, smartphone shipments reached 150 million units and 5Gsmartphone shipments crossed 4 million in 2020, driven by highconsumer demand post-lockdown. In October 2020, LG Electronics India sold over 1.75 lakh units of itsG8X ThinQ mobile handset in just 12 hours at Flipkart Big Billion DaysSale and recorded Rs. 350 crore (US 47.51 million) revenue againstsales. Electronics imports are at US 40 billion in July 2021 and expected toincrease to US 200 billion in the near future—surpassing oil imports.Note: LCD - Liquid Crystal Display; LED - Light-emitting DiodeSource: Reserve Bank of India (RBI), Ministry of Electronics and Information Technology (MeitY), News Articles1738.030.9Q1 2020Q1 2021
Increasing FDI inflows The ESDM sector provides lucrative opportunities for investors.From April 2000 to March 2021, Foreign Direct Investment (FDI)equity inflow stood at US 3,166.43 million. For defence electronics, FDI inflows in this sector up to 49% areallowed under automatic route and beyond 49% through governmentapproval The government allows 100% FDI in the ESDM sector through anautomatic route to attract investments from OEMs and IDMs.FDI Inflows in Electronics in India (US million)2018-19451.9The following is a list of areas of interest for investments in ESDM:1. Mobile phone manufacturing2017-18196.92. Semiconductor wafer fabrication3. Light Emitting Diode (LED) and Liquid Crystal Display (LCD)4. Wearable devices5. Solar cells and modules6. Research, innovation and skill development in emerging areassuch as Augmented Reality (AR), Virtual Reality (VR), drones,robotics and additive manufacturing2000-21*3,166.4305007. Medical electronic devices manufacturing8. R&D in automotive electronics and power electronics for mobility9. In July 2021, India selected Dell Inc., Wistron Corp's ICT, Flex Ltd.and Foxconn's Rising Stars to develop and augment exports oflaptops, tablets and personal computers as part of a US 1 billionincentive plan.Notes: OEM - Original Equipment Manufacturer, IDM - Integrated Device Manufacturers, * - From April 2000 To March 2021Source: Make in India18100015002000250030003500
Key investors in electronics sector As of March 03, 2021, 19 companies have filed for the production-linked incentive (PLI) scheme for IT hardware. The scheme was open forapplications until April 30, 2021; its incentives will be available from April 01, 2021. Over the next four years, the scheme is expected to lead to atotal production of Rs. 160,000 crore (US 21.88 billion). Of the total production, IT hardware companies have proposed production of Rs.135,000 crore (US 18.46 billion) and domestic companies have proposed production of Rs. 25,000 crore (US 3.42 billion). In April 2021, Japanese electronics brand AIWA, which registered its India subsidiary in February 2021, is relaunching with five products in the TWS(True Wireless Stereo) and audio segments at a total investment outlay of US 10 million for Phase-1 of operations. In March 2021, Xiaomi, a Chinese multinational electronics company, announced that it will invest Rs. 100 crore (US 13.6 million) to expand itsoffline retail presence in tier 2 and 3 cities, towns and rural India. Under the government's production-linked incentive (PLI) scheme, domestic electronics manufacturers such as Dixon Technologies, InfopowerTechnologies, VVDN and Bhagwati Products (Micromax) have invested US 26.85 million to boost IT hardware manufacturing capacity.Source: Sutherland Research, News Articles19
Government initiatives and policy supportNew schemes to promote electronics manufacturing In April 2020, the Indian government approved three key schemes in order to position India as a global hub for Electronics System Designand Manufacturing (ESDM). This move is anticipated to attract minimum investments worth US 6 billion into the country. The initiativeincludes Production Linked Incentive Scheme (PLI), Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors(SPECS) and Modified Electronics Manufacturing Clusters Scheme (EMC 2.0) Of these, Production Linked Incentive Scheme (PLI), one of the biggest incentive, is aimed at boosting domestic manufacturing of mobilephones and their components, including Assembly, Testing, Marking and Packaging (ATMP) units PLI package of US 5.7 billion (Rs. 420 billion) will be extended as an incentive of 4-6% on incremental sales (of locally manufacturedgoods) for a period of five years This is in line with transforming India into a manufacturing hub of electronics and components, at par with established and more diversifiedcountries such as China and Vietnam In December 2020, the Government of India issued expression of interest (EoI) to set up or expand the existing semiconductor wafer/ devicefabrication (FAB) facilities in the country or acquire semiconductor FABs overseas. Under Union Budget 2021-22, the government has set a target to get Rs. 18,000 crore (US 2.4 billion) investments in the electronicsmanufacturing segment by 2021-22. It has also allocated Rs. 2,631.32 crore (US 361.50 million) to promote electronics and IT hardwaremanufacturing programmes (Modified Special Incentive Package Scheme (M-SIPS), Electronics Development Fund (EDF) andManufacturing Clusters). Under the production-linked incentive (PLI) scheme for IT Hardware Products, the Ministry of Electronics and Information Technology hasapproved 14 qualified applicants. To manufacture these products in India, the government will offer incentives of US 983.76 million over thenext four years. In this duration, production worth US 21.62 billion and exports of US 8.06 billion are expected.Remission of duties or taxes on export products (RoDTEP) scheme. In January 2021, the India Cellular and Electronics Association (ICEA) proposed a RoDTEP rate of 2% on smartphones, 2.4% onfeaturephones, 2% on tablets/laptops, 3.4% on battery chargers and 1.48% on battery packs.Source: Sutherland Research, Ministry of Electronics and Information Technology (MeitY), News Articles20
Skill development in ESDM sector1. Centre of excellence (CoE) inNoida (Gautam Buddha Nagar) In December 2020, to establish therequired ecosystem at Noida, the IndianCellular and Electronics Association(ICEA) proposed the establishment of acentre of excellence in Noida for productbased Li-ion cells (post-cell). This hasbeen approved and groundwork will beginas soon as the Government of Indiareceives sanctions. In partnership with theMinistry of Electronics & InformationTechnology and industrial associations,the government will create three centresof excellence.3. Centre for Invention,Innovation, Incubation andTraining (CIIIT) In December 2020, to strengthen industry–academia partnership and bring qualitativeimprovements in technical education, Mr.Manoj Sinha, the Lieutenant Governor ofJammu and Kashmir, inaugurated theCentre for Invention, Innovation, Incubationand Training (CIIIT), which was establishedat a cost of Rs. 181.57 crore (US 24.88million), at the Government PolytechnicCollege, Baramulla.2. Electronic system incubation centre On December 02, 2020, 'Hubli ESDM Exchange' (HEX), an incubation centre for the development of electronic device design (ESDM),backed and funded by the state government's Karnataka Innovation & Technology Services (KITS) and managed by the India Electronics &Semiconductor Association (IESA), was launched at the KLE Tech Park of the KLE Technical University (KLETU) in Hubballi. A fund of Rs. 3.2 crore (US 433.46 thousand) for three years has been approved by the Department of Electronics, IT, BT, Science &Technology.Notes: ESSCI - Electronics Sector Skills Council of India; NSDC - National Skill Development Corporation; IESA - India Electronics and Semiconductor AssociationSource: Sutherland Research, Ministry of Electronics and Information Technology (MeitY)21
Key Trends and DevelopmentsRECENT TRENDS AND STRATEGIES22
Trends and opportunities123LOCAL MANUFACTURING OFLAPTOPS, TABLETSGROWING DOMESTIC HANDSETMANUFACTURING MARKETESTABLISHING QUANTUM COMPUTINGAPPLICATIONS LAB According to ICRA, India has thepotential to become a significantpart of the global supply chain inelectronics and become a hub forlaptops and tablets by capturing18% of the global exports. The increasing domestic demandfor handset manufacturing andgovernment support policies haveled India to build on its smartphonemanufacturingcapabilities.By2025, it is estimated that theaddressable market for OEMs(original equipment manufacturers)would reach Rs. 10–11 lakh crore(US 140–150 billion). To accelerate quantum computing-ledresearch & development and enable newscientific discoveries, the Ministry ofElectronics and Information Technology(MeitY), in collaboration with AmazonWeb Services (AWS), will establish aquantum computing applications lab in thecountry.quantumcomputing TheMeitYapplications lab will provide quantumcomputing as a service to governmentministries and departments, researchers,scientists, academia and developers, toenable advances in areas such asmanufacturing, healthcare, agriculture andaerospace engineering. By 2025, these initiatives wouldhave a potential production value ofUS 100 billion and will alsogenerate 5 lakh additional jobopportunities.Source: Sutherland Research, News Articles23
Major recent developments (1/3)1August 2020 Samsung Electronics Co. and Apple Inc.’s assembly partners pledged investments worth Rs. 110 billion (US 1.5 billion) to establishmobile phone manufacturing units in India.2September 2020 Larsen & Toubro announced closure of its deal to sell its electrical and automation business to Schneider Electric. The companiesannounced this deal in May 2018; for US 1.9 billion (Rs. 14,000 crore)Tamil Nadu unveiled the Electronics and Hardware Manufacturing Policy, which targets US 100 billion output by 2025, with a goalto contribute 25% to India’s total electronic exports by 20253October 2020 Abaj Group, in partnership with QThree Ventures, will set up ABAJ-QThree Techpark—a manufacturing facility for LED televisions andair-conditioners in Gujarat. Aequs to invest Rs. 3,500 crore (US 476.27 million) to set up a consumer electronics cluster in KarnatakaSource: Sutherland Research, News Articles24
Major recent developments (2/3)4November 2020 On November 7, 2020, a delegation of representatives of seven Taiwanese firms under Taipei Economic and Cultural Centre(TECC) agreed to invest in YSR Electronics Manufacturing Cluster in Andhra Pradesh.HPL Electric & Power established a new R&D centre for smart metres in Gurugram, Haryana.5December 2020 Lenovo announced its plan to start manufacturing tablets in India and expand its laptop manufacturing by 10x. The company is alsoexpecting to grow by 25-30% in the current fiscal year, due to increase in demand from the education segment and largeenterprises.6January 2021 boAt, a earphones and smart wearable manufacturer, received an investment of US 100 million from Warburg Pincus, a keyprivate equity firm.India Cellular & Electronics Association announced its plan to create a smartphone design, R&D and application ecosystem in India.7February 2021 On February 16, 2021, Amazon announced that it will commence manufacturing of electronics products from India with CloudNetwork Technology, a subsidiary of Foxconn in Chennai, later in the year. The device manufacturing programme will be able toproduce ‘Fire TV Stick’ devices in large quantities every year, catering to demands of customers in India.Source: Sutherland Research, News Articles25
Major recent developments (3/3)4July 2021 C4V, a lithium-ion cell manufacturer in the US, invested US 537.15 million in the electric battery manufacturing sector inKarnataka.Source: Sutherland Research, News Articles26
Sector policiesNational Policy on Electronics (NPE), 2019 The National Policy on Electronics (NPE)2019 aims to position India as a global hubfor ESDM by encouraging manufacturingcapabilities in the country to develop corecomponents, including chipsets, andcreating an environment for the industry tocompete on an international platformThe NPE 2019 replaces the NPE 2012,which has successfully built the foundationfor a competitive Indian ESDM value chain.The NPE 2019 targets to promote domesticmanufacturing and export in the entire valuechain of ESDM and achieve a turnover ofUS 400 billion by 2025Phased Manufacturing Programme (PMP) The phased manufacturing programme isessentiallyaroadmapfortariffrationalisation wherein duty differentials arecreatedtoincentivisedomesticmanufacturingTo promote depth in manufacturing, theroadmap was prepared keeping in view thestateofthedesign/manufacturingecosystem in India to substantially increasevalue additionSource: Ministry of Electronics and Information Technology (MeitY), PIB27Production-Linked Incentive (PLI) SchemeOn November 11, 2020, Union Cabinet approved the production-linked incentive (PLI)scheme in 10 key sectors (including electronics and white goods) to boost India’smanufacturing capabilities, exports and promote the ‘Atmanirbhar Bharat’ initiative.For growth industries, such as consumer electronics, electric vehicles and renewableenergy, ACC battery production represents one of the biggest economic opportunities. PLIscheme for the ACC battery would allow key domestic and international players to set up acompetitive ACC battery plants in the region.In March 2021, a scheme for large-scale electronics manufacturing and IT hardware, alongwith a scheme to promote component manufacturing, will reduce the country's dependenceon Chinese electronic products.In May 2021, the cabinet, chaired by the Prime Minister Mr. Narendra Modi, approved aproposal by the Department of Heavy Industries and Public Enterprises to implement theproduction-linked incentive (PLI) scheme 'National Programme on Advanced ChemistryCell (ACC) Battery Storage’ to achieve manufacturing capacity of 50 GWh (Giga WattHour) of ACC and 5 GWh of ‘Niche’ ACC, with an outlay of Rs. 18,100 crore (US 2.47billion).SectorsElectronic/ TechnologyProducts'National Programme onAdvanced Chemistry Cell(ACC) Battery StorageMinistry/ DepartmentApproved financialoutlay over a fiveyear periodMinistry of Electronics andInformation TechnologyRs. 5,000 crore (US 674.92 million)Department of Heavy Industriesand Public EnterprisesRs. 18,100 crore (US 2.47 billion)
New schemes for electronics manufacturing (1/2)To position India as a global hub for ESDM sector and further the vision of the National Policy on Electronics (NPE) 2019, three new schemes wereannounced by the Indian government on April 1, 2020, as follows:Large Scale MobileManufacturingProduction Linked IncentiveScheme (PLI)Expected Five Year OutcomesScheme for Promotion of Manufacturingof Components and Semiconductors(SPECS)Electronics Manufacturing ClusterScheme (EMC 2.0)Domestic ElectronicsSupply Chain ofComponentsProductionUS 106 billionExportsUS 77 billionEmployment1 millionInfrastructure andCommon FacilitiesTotal incentives of up to Rs. 500 billion ( US 6.7 billion)Source: Sutherland Research, Ministry of Electronics and Information Technology (MeitY)28
New schemes for electronics manufacturing (1/2)1Production Linked Incentive Scheme (PLI) PLI offers a production linked incentive to boost domestic manufacturing and attract large investments in mobile phonemanufacturing and specified electronic components, including Assembly, Testing, Marking and Packaging (ATMP) of units.Incentive: 4-6% on incremental sales (over base year) of goods manufactured in India; incentives up to US 5 billion will be awardedover a period of five yearsEligibility: Subject to thresholds of incremental investments and incremental sales of manufactured goods2Scheme for Promotion of Manufacturing of Electronic Components andSemiconductors (SPECS) Aims to offset disabilities in domestic manufacturing of electronic components and semiconductors in order to strengthen theelectronics manufacturing ecosystem in the countryIncentive: 25% on capital expenditure pertaining to plant, machinery, equipment, associated utilities and technology, including R&Don reimbursement basis; up to US 500 million over a period of eight yearsTarget Segments: Electronic components, semiconductors, specialised subassemblies and capital goods for these itemsEligibility: Applicable to investments in new units and expansion of the existing units.3Modified Electronics Manufacturing Clusters scheme (EMC 2.0) EMC 2.0 has been introduced with the objective to address the disabilities, by providing support to create world-class infrastructure,along with common facilities and amenities, including RBF sheds/Plug and Play facilities to attract key global electronicsmanufacturers and their supply chain to establish units in India.Incentive: 50% of project costs, subject to a ceiling of US 10 million for every 100 acres of land.Anchor Units: Electronics manufacturing companies with a commitment to purchase/lease a minimum of 20% of the land area andinvest a minimum of US 40
Mar 03, 2021 · The Electronics SystemDesign & Manufacturing (ESDM) is broadly segregated into—Electronics Systemand Electronics Design. Withpike a s in demand for electronic products, the ESDM sector in India is predicted
