Cabinet clears ₹17,000 cr-IT Hardware PLI Scheme 2.0

Union Minister Dr. Mansukh Mandaviya and Ashwini Vaishnaw addressing the media on Cabinet Decision at National Media Centre.
| Photo Credit: Sushil Kumar Verma

The Cabinet, chaired by Prime Minister Narendra Modi, on May 17 approved the Production Linked Incentive Scheme 2.0 for IT Hardware with a budgetary outlay of ₹17,000 crore.

Electronics manufacturing in India has witnessed consistent growth with a 17% compound annual growth rate (CAGR) in the last 8 years to cross a major benchmark in production — $105 billion (about ₹9 lakh crore) — this year.

“For IT PLI, the budgetary outlay is ₹17,000 crore. The tenure of the programme is 6 years,” Union Minister for IT and Telecom Ashwini Vaishnaw told reporters after the cabinet meeting.

PLI Scheme 2.0 for IT hardware covers laptops, tablets, all-in-one PCs, servers and ultra-small form factor devices.

The Minister said the scheme is expected to lead to incremental production of ₹3.35 lakh crore, incremental investment of ₹2,430 crore and create incremental direct employment for 75,000 people during the scheme period.

42 companies in the telecom manufacturing sector have invested ₹1,600 crore in the first year, instead of the projected ₹900 crore. Two of these companies have become major exporters in the world for complex radio equipment, the Minister added.

The government in February 2021 approved the PLI scheme for IT hardware, covering the production of laptops, tablets, All-in-One PCs and servers with an outlay of ₹7,350 crore.

However, industry players had requested the government to enhance outlay for the segment.

PLI Scheme, launched in April 2020 with a focus on mobile phone production, has given a massive boost to electronics manufacturing in the country.

India has become the world’s second-largest manufacturer of mobile phones. Exports of mobile phones crossed a major milestone of $11 billion (about ₹90 thousand crore) in March.

The global electronics manufacturing ecosystem is coming to India, and it is emerging as a major electronics manufacturing country.

Building on the success of the Production Linked Incentive scheme (PLI) for mobile phones, the Union Cabinet has approved PLI Scheme 2.0 for IT hardware.

(with PTI inputs)