India’s cash stimulus to boost domestic manufacturing has attracted more than $17 billion (about 142,279 crore rupees) in investment since the launch of the manufacturing-linked scheme in 2020, a government official said on Wednesday, amid efforts to cut imports from China.
The scheme, which offers four to six percent cash incentives on incremental sales to manufacturers, has been launched in 14 sectors, including electronics, pharmaceuticals, textiles and home appliances.
“The PLI program has proved successful in attracting investment and stimulating manufacturing,” said Amardeep Singh Bhatia, Secretary, Department of Industrial Development and Domestic Trade.
India has become a global hub for electronics, particularly smartphones, and is now the second-largest producer of mobile phones, he said, citing Apple’s iPhone exports to cross $12 billion (approximately Rs 1,004,370 crore) in 2023. 24 fiscal year ending March.
The incentives have led to about 11 trillion rupiah ($131.6 billion) worth of output and nearly one million jobs over four years, he said.
After reducing imports of mobile devices from China by bringing in global players such as Apple, India is now planning to produce more laptops, tablets, PCs and servers, official sources said.
On Tuesday, the government extended for three months an “import management system” launched in November 2023 that requires companies to register their laptop and tablet imports.
“We have signaled to the industry that we want to reduce imports, particularly from China,” said one of the official sources in the government.
India’s IT hardware market, including laptops, is valued at nearly $20 billion (approx. Rs. 167,395 crore), with nearly $5 billion (approx. Rs. 41,848 crore) of domestic production, according to consultancy Mordor Intelligence.
India has announced a new system for laptops, tablets, PCs and servers after it scrapped an earlier plan to introduce a licensing regime requiring Apple, Dell and HP to obtain licenses to supply imported laptops and tablets.
In the first phase, the government has approved incentives for 27 IT hardware makers, including Acer, Dell, HP and Lenovo, to manufacture in India, expecting production to reach around USD 42 billion (approximately Rs 3,51,530 crore) over the next few years. said government officials.
“India has a strong case for building its own laptop manufacturing capabilities,” said Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), a Delhi-based think tank, noting that China contributed significantly to these imports, worth more than $9 billion in 2023. year /24.
In India, rising incomes, expanding business activity and education have boosted demand for laptops and other devices, boosting local manufacturing.
Among local electronics manufacturers, Dixon Technologies is eligible for the incentive program and hopes to meet 15 percent of India’s domestic demand by fiscal year 2025/26. “Dixon plans to create a capacity of two million units by FY26, which will meet 15 percent of India’s total demand,” Prithvi Vachani, chief executive of Dixon Technologies, told Reuters. Dixon, which has separate agreements with global companies such as HP to manufacture laptops and PCs in India, will provide manufacturing components locally “in the future,” Vachani added.
© Thomson Reuters 2024
(This story was not edited by NDTV staff and was automatically generated from a syndicated feed.)
