Indian incentives scheme set to boost local manufacturing

Indian incentives scheme set to boost local manufacturing

In a bid to encourage domestic smartphone manufacturing, India’s government has granted incentives worth INR450 billion ($6.12 billion) to 16 local and overseas firms.

India’s Ministry of Electronics and Information Technology stated that the foreign firms included in the initiative were Foxconn – which makes components for Apple – Pegatron, Rising Star, Samsung and Wistron. The local companies are Lava, Micromax, Optiemus Electronics, Padget Electronics and UTL Neolyncs. The remaining six firms to receive the production-based incentives are all components manufacturers.

According to Bloomberg, companies participating in the scheme are expected to manufacture components and devices with a value of INR10.5 trillion across five years, and will be required to export around 60% of these.

If they meet these criteria, the government will provide 4-6% of any sales increases across fiscal 2019-2020. Additionally, they must invest a further INR111 billion in electronics production and create over 200,000 jobs.

The country’s Minister for Electronics and IT, Communications, Law and Justice Ravi Shankar Prasad stated that the incentives programme would lead to greater self-reliance for India by making it an attractive location for electronics manufacturing.

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