On March 28, the Union Cabinet just gave the green light to a significant production-linked incentive (PLI) scheme for manufacturers of non-semiconductor electronics components, with a whopping budget of Rs 22,919 crore. Union Electronics and IT Minister Ashwini Vaishnaw announced this move. This is the first scheme specifically aimed at boosting the manufacturing of non-semiconductor electronics components. The minister stated that the program is expected to generate 91,600 direct jobs and increase investments of approximately Rs 59,350 crore.

"Passive components are approved under the Electronics Component PLI scheme. It has a total package of Rs 22,919 crore. This will be over six years," stated Vaishnaw.

The minister highlighted that the segment in question will cater to the needs of various industries, including telecom, consumer electronics, automotive, medical devices, and power sectors. He also expressed optimism that this initiative will result in a significant production value of Rs 4.56 lakh crore.

"India has started developing capital goods, machine goods used to make electronic products. Major centres have come up in Pune, Coimbatore, Rajkot, Bangalore. Apple today has 64 suppliers in India," stated Vaishnaw.

According to the Electronic Industries Association of India (Elcina), India’s non-semiconductor electronic components production was around $13 billion in 2022. If current trends continue, this figure will rise to $20.7 billion by 2026 and approximately $37 billion by 2030. However, this growth will still leave a projected deficit of $248 billion in the next six years, which is currently covered through imports. To address this issue, Elcina had proposed a support package of $8.57 billion (about Rs 72,500 crore) to help reduce the deficit by Rs 12.36 lakh crore over the next six years. The industry body warns that without government intervention, the deficit could reach $248 billion (around Rs 21 lakh crore) by 2030. However, with proper support, the shortfall in the passive components segment could be reduced to $102 billion (Rs 8.63 lakh crore), cutting the projected deficit by $146 billion (Rs 12.36 lakh crore).

Government consultations indicate a willingness to permit joint ventures between Indian companies and Chinese firms that are part of the global supply chain and collaborate with international brands, sources told Moneycontrol. This has encouraged Indian electronics manufacturing services (EMS) firms to engage in advanced discussions with Chinese players involved in global value chains. Earlier, Moneycontrol reported that the government is open to such partnerships, provided they are subject to appropriate regulations. An inter-ministerial committee led by the Home Ministry will assess each proposal individually.

With the government softening its approach toward China-linked collaborations, EMS companies are rapidly pursuing key agreements that could shape India's electronics manufacturing industry in the years ahead.

Dixon Technologies has partnered with China’s HKC to manufacture display modules, aiming to begin production between July and September 2025. The company is also considering similar collaborations for precision components, mechanical parts, camera modules, and battery packs. During a March 28 interaction with CNBC-TV18, Dixon Technologies highlighted that the electronics component PLI scheme would lower imports and intensify the domestic supply chain. CFO Saurabh Gupta noted that the scheme would help improve the company's profit margins while supporting India’s export goals.

Meanwhile, Zetwerk, a $2 billion manufacturing firm, is exploring joint ventures, technology transfers with global component manufacturers, including Chinese firms, and potential acquisitions to expand its electronics components business.