Big Tech names like Apple, Samsung, as well as Indian firms like Lava and Dixon have decided to take advantage of the Indian government’s production Linked Incentive scheme to produce over Rs. 11 lakh crores worth of mobile devices and other components in the next five years.
Their proposals have been submitted to the Ministry of Electronics and IT, and under the Production Linked Incentive (PLI) scheme, are expected to create about 12 lakh employment opportunities, around 3 lakh of them credited to direct opportunities and around 9 lakh to indirect employment opportunities, as told by a source to the Press Trust of India.
The PLI scheme proposed in the recent budgetary press conference in 1st April by Finance Minister Nirmala Sitharaman, will be active for the next five financial year and seeks to give incentives of 4-6% to electronic companies which manufacture cellular phones and other electronic components such as transistors, diodes, thyristors, resistors, etc.
The scheme was put into motion to attract big foreign investments in the technology and electronics industry, while also giving domestic companies the impetus to expand their production in India.
Indian companies that have applied under the scheme include names like Lava, Dixon Technologies, Micromax and Padget Electronics, and foreign companies consist of the likes of Samsung, and Foxconn Hon Hai, Wistron and Pegatron that are contract manufacturers for Apple’s iPhones. Among the above, Taiwan-based Pegatron is a new entrant in the Indian tech scene.
A source has said, “In the next five years, mobile phones worth about Rs. 9 lakh crore in value under the category of above Rs. 15,000 per unit are expected to be produced in accordance with the proposals submitted by the companies. Rs. 2 lakh crore are expected to be produced in the under-Rs. 15,000 category.”
Along with that, reports talk of export demand worth some Rs. 7 lakh crores will be met owing to the production capacities proposed by the companies.
Another source, intimate of the submission, informs that Lava plans to invest around Rs. 800 crore over the span of the next five years.
With 8-10 companies having already filed applications for component manufacturing, including motherboard manufacturers AT&S, Ascent Circuits, Sahasra, and Vitesco, with sources alleging production of components worth Rs. 40,000 crores in valuation, the industry and FDI looks towards a bright economic future under PLI.