India’s Electronics Journey: A Milestone at a Time…

Historical Context (1980s-2010s)

Early Beginnings

India’s electronics journey began in the 1960s with the establishment of public sector units like Bharat Electronics Limited (BEL) and Electronics Corporation of India Limited (ECIL). However, the industry remained largely focused on defense and telecommunications equipment with limited consumer electronics production.

The Lost Decades (1990s-2000s)

Despite the IT services boom, India missed the global electronics manufacturing wave. Key challenges included:

– High import duties on components
– Complex regulatory framework
– Inadequate infrastructure
– Limited skilled workforce
– Absence of a comprehensive electronics policy

Import Dependency Crisis

By 2010, India had become the world’s second-largest importer of electronics, with imports reaching $45 billion while exports remained minimal at $5 billion, creating a massive trade deficit.

Present State (2014-2025)

Market Size and Growth

Current Market Value: $155 billion (2024) [Industry estimates]
Production Value: Over 8.2 trillion Indian rupees (approximately $101 billion) in 2023 [Statista, 2024]
Annual Growth Rate: 15-20% [Industry reports]
Employment: Over 4.5 million people directly employed [Government data]
Export Growth: Electronics exports have surged from INR 382.6 billion (US$4.5 billion) in 2014-15 to INR 2.41 trillion (US$28.45 billion) in 2023-24, reflecting a CAGR of 22.7 percent [Ministry of Electronics and IT]

Key Segments

Mobile Phones: Largest segment accounting for 50% of production. India’s smartphone market grew 4% YoY in 2024, with shipments reaching 151 million units [IDC Worldwide Quarterly Mobile Phone Tracker]
Consumer Electronics: TVs, audio systems, home appliances – Consumer electronics market valued at USD 80.8 billion in 2024, expected to reach USD 149.1 billion by 2033 [Custom Market Insights, 2024]
Electronic Components: Semiconductors, PCBs, displays
Industrial Electronics: Medical devices, automotive electronics
IT Hardware: Laptops, tablets, servers

Manufacturing Hubs

Tamil Nadu: Chennai (mobile phones, components)

Karnataka: Bengaluru (IT hardware, R&D)

Uttar Pradesh: Noida, Greater Noida (mobile manufacturing)

Haryana: Gurugram, Manesar (automotive electronics)

Andhra Pradesh: Sri City (electronics manufacturing)

Gujarat: Ahmedabad (electronic components)

Government Initiatives and Policy Framework

National Policy on Electronics (NPE) 2019

Vision: Position India as a global hub for Electronics System Design and Manufacturing (ESDM) [Prime Minister’s Office, 2019]

Targets by 2025 [Official Government Document]:

Turnover of $400 billion (approximately INR 26,00,000 crore)
Targeted production of 1.0 billion (100 crore) mobile handsets valued at $190 billion
Exports of $120 billion
Employment for 10 million people

Major Government Schemes

Production Linked Incentive (PLI) Scheme

Launch: 2020

Budget: ₹76,000 crores across multiple sectors

Coverage:

Mobile manufacturing and components
IT hardware (laptops, tablets, servers)
Telecom equipment
Electronic components and semiconductors

Latest Updates (2024-2025):

New PLI scheme worth ₹22,919 crore approved for electronic components manufacturing
Mobile phone exports rose from ₹228 billion (2020-21) to ₹1.2 trillion (2023-24), achieving 78% compound annual growth rate
Industry seeks additional ₹35,000 crore PLI support to increase domestic value addition from 18% to 35-40% in mobile manufacturing

Success Metrics:

Mobile exports increased from $2.6 billion (2020-21) to $14.4 billion (2023-24)
Apple iPhone production value crossed $7 billion in India

Modified Special Incentive Package Scheme (M-SIPS)

Capital subsidy of 20-25% for investments in electronics manufacturing
Reimbursement of countervailing duty/excise duty for 10 years

Electronic Manufacturing Clusters (EMC)

Development of world-class infrastructure for electronics manufacturing
20+ EMCs approved across different states

Design Linked Incentive (DLI) Scheme

Budget: ₹76,000 crores over 6 years
Focus: Semiconductor design, chip development, and R&D

State-Level Initiatives

Tamil Nadu: Electronics hardware manufacturing policy with land allocation and subsidies
Karnataka: Aerospace and Electronics Policy with focus on R&D
Uttar Pradesh: Electronics manufacturing policy with single-window clearance
Telangana: T-Hub for electronics startups and innovation

Key Indian Industry Leaders

Manufacturing Companies

Dixon Technologies: Leading ODM/EMS player
Amber Enterprises: Air conditioning and consumer appliances
Voltas: Home appliances and cooling solutions
Havells: Electrical equipment and consumer durables
Bajaj Electricals: Consumer appliances and lighting

Semiconductor and Components

Tata Electronics: Semiconductor assembly and testing
Vedanta-Foxconn: Joint venture for semiconductor manufacturing
L&T Semiconductor: Chip design and manufacturing services
Saankhya Labs: Semiconductor design for broadcast and broadband

Contract Manufacturing

Foxconn India: Major iPhone assembler
Wistron: Apple supplier for iPhone assembly
Flextronics: EMS services
Jabil: Electronic manufacturing services

Global Context and Competition

Global Electronics Manufacturing Landscape

Total Market Size: $2.4 trillion globally

Major Manufacturing Hubs:

China: 28% of global production
South Korea: 12% of global production
Taiwan: 8% of global production
Japan: 7% of global production
India: 3% of global production (2024)

China Plus One Strategy

The global supply chain diversification post-COVID-19 has benefited India:

Companies relocating: Apple, Samsung, Xiaomi, Oppo, Vivo
Geopolitical tensions: US-China trade war accelerating relocation
Supply chain resilience: Companies seeking alternative manufacturing bases

Competitive Advantages

Large domestic market: 1.4 billion consumers
Cost-competitive labor: 30-40% lower than China
English-speaking workforce: Advantage in global operations
Government support: Strong policy backing and incentives
Democratic stability: Predictable business environment

Challenges Against Global Competition

Infrastructure gaps**: Power, logistics, ports
Component ecosystem**: Heavy dependence on imports (70%)
Skilled workforce**: Need for technical training
R&D investment**: Lower than global competitors
Ease of doing business**: Regulatory complexities

Future Outlook and Projections

Market Projections

2025: $300 billion market size, $120 billion production
2030: $500 billion market size, $300 billion production
Export potential: $100+ billion by 2030

Emerging Opportunities

Semiconductor Manufacturing

India Semiconductor Mission: $10 billion incentive package

Major Projects Progress (2024-2025):

Micron Technology: $2.75 billion OSAT facility in Sanand, Gujarat – first chips expected by mid-2025
Tata Electronics: ₹27,000 crore ATMP facility in Morigaon, Assam – capacity of 48 million chips daily
CG Power: ₹7,600 crore ATMP facility in partnership with Renesas Electronics – capacity of 15 million chips daily
Fab facilities: 3-4 major fabs planned by 2030, with Tata’s mega semiconductor fab approved for Dholera, Gujarat
Compound semiconductors: Focus on GaN, SiC for 5G and automotive

Electric Vehicle Electronics

EV adoption: 30% of vehicle sales by 2030
-Battery manufacturing: Gigafactory investments
Charging infrastructure: Electronics for EV ecosystem

5G and Telecom Equipment

5G rollout: Massive infrastructure upgrade
Indigenous 5G: Development of Indian 5G technology stack
Network equipment: Import substitution opportunities

Defense Electronics

Atmanirbhar Bharat: Self-reliance in defense
Offset requirements: Technology transfer and local production
Export potential: Defense electronics to friendly nations

Strategic Initiatives for 2025-2030

Semiconductor Ecosystem Development

Establish 3-4 major semiconductor fabs
Develop compound semiconductor capabilities
Create 50+ chip design companies
Build complete supply chain ecosystem

Component Localization

Reduce import dependency from 70% to 40%
Develop local PCB manufacturing
Establish display manufacturing facilities
Build passive component manufacturing base

R&D and Innovation

Increase R&D spending to 3% of turnover
Establish 20+ electronics R&D centers
Create university-industry partnerships
Develop IP and patents portfolio

Skill Development

Train 1 million skilled technicians
Establish electronics-focused ITIs
Create industry-academia partnerships
Develop advanced manufacturing skills

Investment Landscape

Foreign Direct Investment (FDI)

Total FDI (2014-2024): $15+ billion in electronics
Major investors: Foxconn, Samsung, Apple, Xiaomi
Investment pipeline: $25+ billion committed for 2024-2027

Government Investment

PLI allocation: ₹76,000 crores approved
Infrastructure development: ₹50,000 crores for EMCs
Semiconductor mission: ₹76,000 crores over 6 years

Private Sector Investment

Tata Group: $2 billion in semiconductor and electronics
Reliance: $1.5 billion in electronics manufacturing
Adani Group: $1 billion in data center and electronics

Challenges and Risk Factors

Short-term Challenges (2025-2027)

Supply chain disruptions: Geopolitical tensions
Skilled workforce shortage: Technical talent gap
Infrastructure bottlenecks: Power, logistics, water
Component import dependency: 70% imports continue

Medium-term Challenges (2027-2030)

Technology advancement**: Keeping pace with global innovation
Competition from Vietnam/Mexico**: Alternative manufacturing bases
Environmental regulations**: Sustainability requirements
Trade policy changes**: Global trade dynamics

Long-term Strategic Risks

Technological disruption: New manufacturing technologies
Geopolitical shifts: Changes in global supply chains
Climate change impact: Environmental sustainability
Automation: Impact on employment-intensive manufacturing

Success Metrics and KPIs

Current Performance (2024-2025)

Production: Over 8.2 trillion Indian rupees (approximately $101 billion) [Statista, 2024]
Exports: INR 2.41 trillion (US$28.45 billion) [Ministry of Electronics and IT]
Employment: 4.5 million
FDI: Rs. 49,068 crore cumulative (US$ 5.67 billion) [IBEF, 2024]
Component import dependency: Reduced from 85% to 70%
Mobile manufacturing: Surged 21 times to reach US$ 49.3 billion [IBEF, 2024]

Targets for 2030

Production: $300+ billion
Exports: $100+ billion
Employment: 10+ million
Global market share: 8-10%

Conclusion

India’s electronics manufacturing industry stands at a critical juncture with unprecedented opportunities driven by global supply chain shifts, strong government support, and a large domestic market. The successful implementation of PLI schemes, development of semiconductor capabilities, and creation of a robust component ecosystem will determine India’s ability to become a global electronics manufacturing hub.

The industry’s transformation from a net importer to a significant exporter in mobile phones demonstrates the potential for replicating this success across other electronics segments. However, sustained focus on infrastructure development, skill creation, R&D investment, and policy consistency will be crucial for achieving the ambitious targets set for 2030.

With the right strategic execution, India has the potential to capture 8-10% of global electronics production and emerge as the world’s third-largest electronics manufacturer after China and South Korea by 2030.