Government to offer USD 500 crore incentive to further localise smartphone production

Smartphone manufacturing industry is expanding in India; however, it faces criticism due to the country's heavy reliance on China for components. In response to this issue, the government is planning to introduce incentives aimed at boosting local production.

India is planning to offer significant financial incentives, up to USD 500 crore, to encourage companies to produce parts locally for a variety of electronic devices, including mobile phones and laptops. This initiative aims to strengthen the growing tech industry and reduce dependence on imports from China.

Over the past six years, India’s production of electronics has more than doubled, reaching approximately USD 11,500 crore in 2024. This growth has been largely driven by major companies, such as Apple and Samsung, expanding their mobile manufacturing operations in the country. India is now recognized as the fourth-largest supplier of smartphones globally.

However, the electronics industry has been criticised for heavily relying on components imported from other countries, particularly China. To address this issue, the new scheme will provide incentives for the production of essential parts like printed circuit boards. This move is intended to boost local manufacturing and develop stronger supply chains for a wide range of electronic products.

The scheme is expected to be introduced in the coming two to three months and will offer financial support to both international and local companies that meet certain criteria. The details of the plan, created by India’s electronics ministry, are currently being finalised, with necessary approvals from the finance ministry expected soon.

India has set an ambitious goal to increase its electronics manufacturing to USD 50,000 crore by the fiscal year 2030, which includes producing electronic components worth USD 1,500 billion. In the fiscal year 2024, India imported electronics and telecom equipment valued at USD 8,980 crore, with over half of these imports coming from China and Hong Kong, according to a private research organisation.

In other news, the Telecom Regulatory Authority of India (TRAI) has instructed all telecom operators in India to publish geospatial coverage maps indicating the areas where they provide wireless voice and broadband services. The regulatory authority has urged mobile network providers to display these coverage maps on their websites, clearly illustrating the availability of their wireless services, including 2G, 3G, 4G, and 5G, for customer access.

ALSO READ: WhatsApp rolling out new typing indicator for its users: Here's what it will look like

Inputs from Reuters