The PLI scheme (Production linked incentive scheme) for IT hardware notified in March this year, has drawn the attention of major manufacturers. According to officially available information, 19 companies have filed applications under the scheme. The applications could have been filed by 30 April.
Dell, ICT (Wistron), Flextronics, Rising Stars Hi-Tech (Foxconn), and Lava are the electronics hardware manufacturers that have applied. Around 14 companies have also put their applications under the category ‘domestic companies’. These companies include Dixon, Infopower (JV of Sahasra and MiTAC), Bhagwati (Micromax), Syrma, Orbic, Neolync, Optiemus, Netweb, VVDN, Smile Electronics, Panache Digilife, HLBS, RDP Workstations, and Coconics. It is expected that these companies will expand their manufacturing immensely to gain the stature of national companies in IT hardware production.
The PLI for IT hardware was notified on 3 March. “The PLI Scheme extends an incentive of 4% to 2%/ 1% on net incremental sales (over the 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),” states an official release.
The Indian government has taken several initiatives to encourage domestic manufacturing. These include Digital India and Make in India programmes. Positioning India as a global hub for electronics system design and manufacturing (ESDM) is an ambition. The PLI for IT hardware is preceded by the PLI scheme for mobile phone (handsets and components) manufacturing. The scheme for hardware covers laptops, tablets, all-in-one personal computers, and servers.
Ravi Shankar Prasad, Union minister for electronics & IT, communications, law, and justice, has considered the scheme a success in terms of response it has drawn. “We are optimistic and looking forward to building a strong ecosystem across the value chain and integrating with the global value chains, thereby strengthening the electronics manufacturing ecosystem in the country,” he has stated.
Total production of around Rs 1,60,000 crore is expected to occur over the next four years, with the scheme in place. This includes a proposed production by IT hardware companies, worth Rs 1,35,000 crore. The Domestic Companies proposal is worth over Rs 25,000 crore.
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