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Tough balancing act
India's electronics manufacturing dream
Business Standard

Reform and incentives

Govt must seek to benefit manufacturing more broadly

Topics
manufacturing  | Indian Economy | Smartphone market

Business Standard Editorial Comment  |  New Delhi 



The Union Ministry of Electronics and Information Technology last week moved forward with the production-linked incentive (PLI) scheme for mobile phone (and certain specified other) companies. Sixteen companies were told that their plans for participation in the scheme were approved — the firms including some of the corporations that make Apple’s iPhones on contract, such as Foxconn. The idea behind the scheme is to entice these manufacturers to invest in India and increase production through incentive payments over the course of five years. The incentive rate will begin at 6 per cent and go down to 4 per cent over the life of the scheme; the government says it will cost about Rs 41,000 crore over the duration. The belief, however, is that production in India will be a multiple of this amount. Naturally, industry says it is enthused by the possibilities. Other sectors have also put their hands out, asking for similar schemes to be implemented. In the pharmaceuticals sector, it has been reported that over 24 companies have applied for the equivalent PLI schemes for active pharmaceutical ingredients and medical devices. Textiles and textile machinery manufacture are possibly the next focus of attention for PLI programmes.

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First Published: Sun, October 11 2020. 22:15 IST

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