The target IT hardware segments include Laptops, Tablets, All-in-One Personal Computers (PCs) and Servers

A total of 19 companies including Dell, Rising Stars Hi-Tech (Foxconn) and Lava have filed applications under the Production Linked Incentive (PLI) scheme for IT hardware.

Besides the big international brands, 14 local players such as Dixon, Infopower (JV of Sahasra and MiTAC), Bhagwati (Micromax), Syrma, Orbic, Neolync, Optiemus, Netweb, VVDN, Smile Electronics, Panache Digilife, HLBS, RDP Workstations and Coconics have also joined the bandwagon and submitted applications.

The Production Linked Incentive Scheme (PLI) for IT Hardware was notified on March 3. The PLI Scheme extends an incentive of 4% to 2%/ 1% on net incremental sales (over base year of FY 2019-20) of goods under target segments that are manufactured in India to eligible companies, for a period of four years (FY 2021-22 to FY 2024-25).

In his address marking the conclusion of application window under the scheme, Union Minister for Electronics and IT, Communications, Law and Justice Ravi Shankar Prasad said that PLI scheme for IT Hardware has been a huge success in terms of the applications received from Global as well as Domestic companies engaged in manufacturing electronics hardware products.

“Industry has reposed its faith in India’s stellar progress as a world class manufacturing destination and this resonates strongly with Prime Minister’s clarion call of AtmaNirbhar Bharat - a self-reliant India,” he said.

The Minister further said, “We are optimistic and looking forward to building a strong ecosystem across the value chain and integrating with the global value chains, thereby strengthening electronics manufacturing ecosystem in the country”.

The National Policy on Electronics 2019 envisions positioning India as a global hub for Electronics System Design and Manufacturing (ESDM) by focusing on size and scale, promoting exports and enhancing domestic value addition by creating an enabling environment for the industry to compete globally.

After the success of the Production Linked Incentive Scheme in bringing investments in mobile phone (handsets and components) manufacturing, the Union Cabinet had approved the Production Linked Incentive (PLI) Scheme for IT hardware products.

The target IT hardware segments under the Scheme include Laptops, Tablets, All-in-One Personal Computers (PCs) and Servers. The scheme proposes production linked incentives to boost domestic manufacturing and attract large investments in the value chain of these IT Hardware products.

Over the next 4 years, the Scheme is expected to lead to total production of about INR 1,60,000 crore. Out of the total production, IT Hardware companies have proposed a production of over Rs 1,35,000 crore, and Domestic Companies have proposed a production of over Rs 25,000 crore.

The scheme is expected to promote exports significantly. Out of the total production of Rs 1,60,000 crore in the next 4 years, more than 37% will be contributed by exports of the order of Rs 60,000 crore.

The scheme will bring additional investment in electronics manufacturing to the tune of INR 2,350 crore.

It will generate approximately 37,500 direct employment opportunities in the next 4 years along with creation of additional indirect employment of nearly 3 times the direct employment.

Domestic Value Addition is expected to grow from the current 5-12% to 16-35%.

With the demand for electronics in India expected to grow manifold by 2025, the Union Minister expressed confidence that the PLI scheme and other initiatives to promote electronics manufacturing will help in making India a competitive destination for electronics manufacturing and give a boost to Atmanirbhar Bharat.