INDIA'S ELECTRONICS COMPONENTS MANUFACTURE: Powering The Next Leap In Electronics

Can India break free from its reliance on imported electronics and emerge as the next global manufacturing giant? The electronics component manufacturing scheme (ECMS) aims to make that leap possible, backed by billions in incentives, ambitious targets, and a tight timeline. But the real question remains: Can India overcome entrenched challenges and reshape its electronics future?

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India's electronics sector is undergoing a structural shift, from assembling finished products to building a self-reliant, globally competitive manufacturing base. Domestic production has grown at over 15% CAGR (FY21-FY24), with exports touching US$35 billion in FY24. The government now targets US$500 billion in total production by FY2030, including US$150 billion in components.

However, the sector remains heavily import-dependent, sourcing 80-85% of its components—including semiconductors and printed circuit boards (PCBs)—from Asia due to limited local design and manufacturing capabilities. To address this, India launched the Electronics Component Manufacturing Scheme (ECMS) in April 2025, its most ambitious initiative yet, alongside other programmes like PLI, SPECS, and MSIPS. These schemes offer combined central and state incentives exceeding 100% of the investment, through a mix of subsidies and tax credits. The incentives, tailored to component categories and production models, aim to reduce import reliance, attract investment, enhance value addition (currently just 15-18%), and integrate Indian firms into global value chains. Driven by ‘Make in India’ and supported by a robust policy framework, India is positioning itself as a key player in the US$2900 billion global electronics market.

Why ECMS? The strategic need

Despite India’s emergence as a major hub for electronics assembly, a staggering 70-80% of components, resistors, capacitors, connectors, and more, are still imported, mostly duty-free under ITA-11. This heavy reliance inflates the import bill, limits domestic value addition, and exposes India to global supply chain shocks. The Covid-19 pandemic highlighted these vulnerabilities, as supply disruptions threatened the entire industry. The ECMS seeks to change this dynamic by enabling India to transition from an assembler to a true manufacturing leader.

Scheme scale, scope, and ambition