Economic Survey 2023: India becomes second-largest mobile manufacturer globally

On the back of the Production Linked Incentive  (PLI) scheme for mobile manufacturing, India has become the second-largest mobile phone manufacturer globally. The Economic Survey stated that the production of handsets has gone up from 6 crore units in FY15 to 31 crore units in FY 22. These numbers are expected to improve as more domestic and global players set up and expand their bases in India. Two major global and domestic players in electronic manufacturing services have already embraced the PLI scheme 

The PLI for Large Scale Electronics Manufacturing was notified on April 01, 2020, and offers a production linked incentive to boost domestic manufacturing and attract large investments in mobile phone manufacturing and specified electronic components, including Assembly, Testing, Marking and Packaging (ATMP) units. The scheme extends an incentive of 4 to 6 per cent on incremental sales (over base year) of goods manufactured in India and covered under target segments, to eligible companies, for a period of five years subsequent to the base year as defined. 

The scheme in October 2020 had received a total of 16 eligible applicants, including Samsung, Foxconn Hon Hai, Rising Star, Wistron, Lava, Bhagwati (Micromax), Padget Electronics, UTL Neolyncs and Pegatron, have been approved by the Ministry of Electronics and Information and Technology (MeitY) under the Production Linked Incentive Scheme (PIL) for large-scale electronics manufacturing. Apple alone exported iPhones worth Rs 8100 crore in December 2022. This helped in taking the overall industry exports of smartphones to Rs 10,000 crore. And mobile phone exports from India may reach $9-10 billion levels in FY23. 

The Indian government expects participation in the PLI scheme will help many more domestic players to attain economies of scale in production through localising. Hence, this will further enhance export competitiveness and increase India’s participation in the global value chain.

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