As major companies are trying to move their production out of China to other countries, India is trying to attract some of the moving companies to find a new place to set up their production out of China.
Union Minister for Electronics & Information Technology of India, Ravi Shankar Prasad has announced three new electronics manufacturing guidelines that are designed to boost local manufacturing and attract foreign investments in India.
The three announced schemes will account for Rs. 50,000 crores or about $7 billion:
Production Linked Incentive Scheme (PLI) for Large Scale Electronics Manufacturing
Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS)
Modified Electronics Manufacturing Clusters (EMC 2.0)
“The three new Schemes are expected to attract substantial investments, increase production of mobile phones and their parts/ components to around Rs.10,00,000 crore by 2025 and generate around 5 lakh direct and 15 lakh indirect jobs.” reads the official press release.
The PLI Scheme will provide an incentive of 4% to 6% on incremental sales of goods manufactured in India for a period of five years subsequent to the base year.
The SPECS Scheme aims to provide up to 25 percent incentive on capital expenditure for electronic components, semiconductors, and display fabrication units.
The EMC 2.0 scheme shall provide support for the creation of world-class infrastructure along with common facilities and amenities, including Ready Built Factory (RBF) sheds / Plug and Play facilities for attracting major global electronics manufacturers, along with their supply chains.
In the pilot period, the government will be choosing five global and five Indian smartphone brands for this initiative, names are expected to be announced in the next couple of months.