India has taken a significant step towards boosting domestic manufacturing and attracting large investments in the IT hardware value chain. Among the 27 companies granted approval to manufacture tech hardware in India are acclaimed tech giants Dell, HP, and Lenovo. This move comes as part of India’s production-linked incentive scheme, aimed at enhancing domestic production.
The production-linked incentive scheme, known as PLI Scheme 2.0 for IT hardware, was approved by the government in May. It offers incentives to companies manufacturing goods within the country. The Ministry of Electronics and IT has stated that renowned brands such as Acer, Asus, Dell, HP, and Lenovo will now have their IT hardware manufactured in India.
The scheme has an allocated budget of 170 billion Indian rupees (approximately $2 billion) over a span of six years. It covers the manufacturing of laptops, tablets, all-in-one personal computers, micro PCs, and servers.
Minister of Railways, Communications and Electronics and IT Ashwini Vaishnaw announced that 23 out of the 27 approved applicants are prepared to commence manufacturing on “day zero.” This development is expected to attract a collective investment of $360 million and generate around 200,000 job opportunities, including 50,000 direct employment prospects and 150,000 indirect employment opportunities. Additionally, it is projected that the Indian IT hardware market will grow from $15.52 billion in 2022 to $22.77 billion in 2027.
India recognizes the need to level the playing field in the IT hardware manufacturing sector and compensate for manufacturing disabilities compared to other major economies. The PLI Scheme 2.0 for IT Hardware aims to address this by encouraging the localization of components and sub-assemblies and facilitating the development of a robust supply chain within the country.
This move aligns with a broader trend among IT hardware manufacturers, such as Apple supplier Foxconn and Samsung, who are diversifying their manufacturing bases beyond China. India’s attractive incentives for electronics production, coupled with its position as the world’s second-largest smartphone market, make it an appealing destination for manufacturers looking to expand their operations.
1. What is the production-linked incentive scheme in India?
The production-linked incentive (PLI) scheme is a government initiative in India that offers incentives to companies to manufacture goods domestically. It aims to boost domestic production, create job opportunities, and attract investments in various sectors.
2. Which tech giants have received approval to manufacture IT hardware in India?
Dell, HP, and Lenovo are among the 27 companies that have been granted approval to manufacture IT hardware in India under the PLI Scheme 2.0 for IT hardware.
3. What are the types of IT hardware covered under the scheme?
The PLI Scheme 2.0 for IT hardware covers the manufacturing of laptops, tablets, all-in-one personal computers, micro PCs, and servers.
4. How much investment is expected from the approved companies?
The approved companies are expected to invest a collective amount of $360 million in India.
5. How many job opportunities will be created as a result of this initiative?
It is projected that this initiative will generate approximately 200,000 job opportunities, including 50,000 direct employment prospects and 150,000 indirect employment opportunities.