Global laptop brands tap India as China risk grows, PLI gains traction

India's ₹17,000-crore PLI scheme is making global laptop brands like Asus, HP and MSI to shift production from China to India, boosting domestic manufacturing and ecosystem development

India’s IT hardware manufacturing ambitions are getting a boost, as several international laptop brands begin shifting production from China to local partners. This is driven by growing interest in the ₹17,000 crore Production-Linked Incentive (PLI) scheme, which is now starting to show real momentum after a slow start, according to a report by The Economic Times. 

This strategic pivot comes amid escalating trade tensions between China and the United States. Although the Trump-era exemption on tariffs for laptops and IT hardware from China remains in place, fears of upcoming product-specific tariffs — expected in May — have prompted companies to expedite discussions with Indian manufacturing partners.

   

India offers competitive edge to global brands

Indian manufacturers are seizing the moment by enhancing their production capabilities and leveraging lower tariffs to attract global partners. These firms also benefit from meeting PLI targets, which in turn qualify them to participate in government tenders requiring 20–50 per cent local content. 

Currently, India’s domestic capacity can offset 10-20 per cent of total laptop imports, valued at approximately $11 billion in FY24. Local laptop production stands at around $1 billion, the news report said.   

 

Asus, MSI lead the charge

Taiwanese brand Asus recently launched an assembly line in collaboration with VVDN Technologies at Manesar, following months of discussions focused on scaling operations and increasing localisation. A single assembly line at the facility is capable of producing a new laptop every 240 seconds, The Economic Times mentioned, quoting VVDN Senior Vice-President Gourab Basu.

  Meanwhile, MSI has partnered with Gurugram-based Syrma SGS to begin local manufacturing. With India tightening its laptop import regulations, Syrma sees an opening to attract business away from higher-tariff regions like China and Vietnam. 

 

Dixon Tech expands with HP, Lenovo & Asus

Dixon Technologies is investing over ₹1,000 crore in a new facility in Tamil Nadu, where it will manufacture laptops for HP. Scheduled to begin operations in May, the unit will have an initial production capacity of two million laptops annually.

The company has also signed agreements to manufacture laptops for Lenovo and Asus at this new site and is already handling 25–30 per cent of Acer’s domestic production through its Noida facility.

 

PLI 2.0: Stronger push for localisation

Launched on May 29, 2023, the second phase of the PLI scheme for IT hardware carries a budgetary allocation of ₹17,000 crore over six years. It offers an average incentive of 5 per cent on net incremental sales of domestically produced devices, with a requirement to increase local component use annually to maximise incentives. 

The government anticipates an investment of ₹3,000 crore under this phase, which is expected to drive ₹3.5 trillion worth of production and create approximately 47,000 jobs. As of December 2024, the scheme had attracted ₹520 crore in investments, resulted in ₹10,000 crore worth of production, and generated around 3,900 jobs.

 

India eyes ecosystem development

Despite a sluggish start, the PLI scheme is beginning to draw interest as the economics of global manufacturing shift. Until recently, a 4–5 per cent cost advantage made China an attractive manufacturing hub. But as tariffs and supply chain concerns mount, brands are working to replicate China’s extensive ecosystem in India. 

The coming months may determine if India can position itself as a viable alternative to China in the global IT hardware supply chain.