Apple vendors, Samsung propose Rs 11 trn mobile phone production in India

The government had notified three schemes on April 1 for the promotion of electronics.
iPhone maker Apple's contract manufacturers, as well as firms like Samsung, Lava and Dixon have proposed to produce mobile devices and components of over Rs 11 trillion in the next five years under the government's new scheme to boost electronics manufacturing, according to sources.

The proposals submitted by the companies to the Ministry of Electronics and IT to avail benefits of the Production Link Incentives (PLI) are expected to create 12 lakh employment opportunities -- 3 lakh direct and around 9 lakh indirect jobs, a source told PTI.

"Foreign companies that have submitted proposals for the scheme include Samsung, Foxconn Hon Hai, Rising Star, Wistron and Pegatron," the source said.

Foxconn Hon Hai, Wistron and Pegatron are contract manufacturers for Apple iPhones.

Taiwan-based Pegatron is a new investor in India.

Apple and Samsung account for nearly 60 per cent of global sales revenue of mobile phones.

"In the next five years, mobile phones worth about Rs 9 trillion in the category of above Rs 15,000 per unit are expected to be produced as per the proposals submitted by the companies. Mobile phones worth about Rs 2 trillion are expected to be produced in the sub-Rs 15,000 category," the source said.

Export demand of about Rs 7 trillion is expected to be met from the proposed production capacities.

Indian companies that have applied under the scheme include Lava, Dixon Technologies, Micromax and Padget Electronics.

"Lava has plans to invest around Rs 800 crore over the next five years under the scheme," another source aware of the submission said.

The government had notified three schemes on April 1 for the promotion of electronics.

These were schemes for manufacturing of electronic components and semiconductors, modified electronics manufacturing clusters (EMC 2.0) scheme, and production-linked incentive scheme for large scale electronics manufacturing.

These schemes jointly offer incentives of around Rs 50,000 crore over the period of next five years.

Electronics and IT Secretary Ajay Prakash Sawhney on June 2 had said that the schemes will push mobile production to Rs 8 trillion in value terms and exports worth Rs 5.98 trillion in the next five years.

Meanwhile, around 8-10 companies have filed applications for component manufacturing which include motherboard maker AT&S, Ascent Circuits, Sahasra and Vitesco.

"They are expected to produce components of over Rs 40,000 crore over the period of next five years under the scheme," an industry source said.


Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel