Govt clears Rs 357 cr for Foxconn under PLI scheme for phone manufacturing

The PLI for large-scale electronics manufacturing sector launched with an aim to make India a competitive destination for electronics manufacturing

An empowered committee headed by Param Iyer, chief executive officer (CEO), NITI Aayog, has approved a production-linked incentive (PLI) scheme of over Rs 400 crore for Foxconn India and Padget Electronics for mobile phone manufacturing. iPhone maker Foxconn India is owned by Hon Hai Foxconn Technology Group. The group, headquartered in Tucheng, New Taipei City, is the world’s top manufacturer and assembler of mobile Foxconn Hon Hai Technology India Mega Development Pvt. Ltd also called Foxconn India would receive an incentive of Rs 357.17 crore for the period between August 1, 2021, and March 31, 2022. It is based on its incremental investments and sales figures.

Foxconn, which is looking to diversify operations from China, is the first global company that has been approved under the target segment ‘Mobile Phones’ for this incentive.

Padget Electronics Pvt. Ltd, which has manufacturing facilities in Noida, Uttar Pradesh, would receive an incentive of Rs 58.29 crore for the January–March 2022 quarter.

The company has already received Rs 53.28 crore under the PLI scheme for large-scale electronics manufacturing (LSEM). It is for the period August–December 2021.
 

The ministry of electronics and IT (MeitY) had presented the proposals for disbursement of incentives to the empowered committee headed by Iyer. The panel also comprises department for promotion of industry and internal trade (DPIIT) secretary Anurag Jain and MeitY secretary Alkesh Kumar Sharma, among others.

A press statement by NITI Aayog said that, as of September 2022, the PLI scheme for LSEM has attracted investments of Rs 4,784 crore. It led to a total production of Rs 2.03 trillion, including exports of Rs 80,769 crore. The scheme claims to have generated employment for 40,916.

The PLI scheme for large-scale electronics manufacturing had attracted leading global players, including Foxconn, Samsung, Pegatron, Rising Star and Wistron. It also saw domestic companies, such as Lava, Micromax, Optiemus, United Telelinks Neolyncs and Padget Electronics take part.

The production of mobile phones has risen from about 60 million in 2014-15 to approximately 310 million in 2021-22.

The department of telecom (DoT) had notified the PLI scheme for telecom and networking products on February 24, 2021. It had a financial outlay of Rs 12,195 crore, over the five years. The core idea of this scheme is to offset the import of telecom equipment worth more than Rs 50,000 crore.

Mobile phone exports during the current year, up to November 2022, have crossed Rs 40,000 crore. This is more than double the exports made during the same period last year, according to government data.