New Delhi: In a concerted effort to bolster India’s status as a global manufacturing hub, the government aims to elevate the demand for electronic components and sub-assemblies to $240 billion by 2030, supporting a target of $500 billion in electronics production and generating at least 280,000 new jobs by 2026, according to a report released on Sunday.
Key components and sub-assemblies, such as Printed Circuit Board Assemblies (PCBAs), are anticipated to exhibit robust growth at a compounded annual growth rate (CAGR) of 30%, reaching $139 billion by 2030, as per findings from the Confederation of Indian Industry (CII) report. The report outlines strategic recommendations to formulate schemes aimed at fostering industry growth.
Last year, the demand for components and sub-assemblies totaled $45.5 billion, supporting electronics production valued at $102 billion.
The report identifies five priority components/sub-assemblies: lithium-ion batteries, camera modules, mechanical parts (enclosures, etc.), displays, and PCBs, which are critical for India’s electronics sector. Together, these segments accounted for 43% of component demand in 2022 and are projected to grow to $51.6 billion by 2030.
Most of these components currently have limited domestic production or rely heavily on imports.
“PCBAs represent a significant opportunity for India, given the predominant reliance on imports. This segment is poised for a 30% growth, driving a demand surge to $87.46 billion by 2030,” the report highlights.
The report recommends the formulation of a fiscal support scheme targeting select components and sub-assemblies with incentives ranging from 6% to 8%, spanning a duration of 6 to 8 years to facilitate scaling up and value addition.
Furthermore, it proposes the introduction of SPECS 2.0 (Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors) with subsidy support ranging from 25% to 40% to attract potential investors across both brownfield and greenfield projects.
“To remain competitive, it is imperative to urgently rationalize import tariffs on critical sub-assemblies and components such as camera modules, display modules, and mechanical parts, aligning them with tariffs in key global markets,” the CII report emphasizes.
“Boosting export demand for domestically manufactured products will not only increase export volumes but also stimulate domestic manufacturing of components and sub-assemblies,” the report concludes.
These policy initiatives are expected to yield substantial economic benefits by fostering the growth of India’s components and sub-assemblies ecosystem.
