The India Cellular and Electronics Association (ICEA) issued a call to both global and domestic stakeholders within the supply chain, urging them to seize the opportunities presented by the Production-Linked Incentive (PLI) scheme 2.0 for IT hardware in India.

With a substantial budgetary allocation exceeding $2 billion, this initiative signifies a significant shift toward strengthening the IT hardware manufacturing sector within the country, as stated in the ICEA's official release.

The PLI 2.0 scheme encompasses various IT hardware items such as laptops, tablets, all-in-one PCs, servers, and ultra-small form factor devices. This initiative aligns with the goal of achieving $25 billion in IT hardware production, with export projections ranging between $12-17 billion by 2025-26.

Pankaj Mohindroo, Chairman of ICEA, emphasised the importance of the PLI 2.0 scheme, stating that it provides an ideal platform for global and domestic supply chains to expand or establish their manufacturing presence in India. He highlighted India's inherent demand and vast growth potential in the market.

According to Union IT and Railways Minister Ashwini Vaishnaw, more than 45 companies have submitted applications under PLI Hardware 2.0, and many of them are already in the process of setting up their manufacturing facilities. Vaishnaw emphasised the significance of semiconductor manufacturing in the context of IT hardware PLI 2.0, as special incentives are provided for chips manufactured in India. He made these remarks during the inauguration of a semiconductor plant in Gujarat.

The architecture of the PLI 2.0 scheme offers an average incentive of 5% over a period of six years. It also includes incentives for the localisation of essential components and sub-assemblies, creating a favourable environment for IT hardware manufacturing in the country.

Pankaj Mohindroo elaborated on the specific incentives for localising key components and subassemblies, such as Bare PCB, memory modules, display panels, power adapters, and batteries. These incentives are designed to significantly reduce entry barriers for manufacturers.

In the initial years, PLI-approved firms will focus on final assembly and Printed Circuit Board Assembly (PCBA). The standalone PLI percentage will taper from 3% to 2%, and then to 1%. By developing domestic capabilities within the supply chain, these firms can retain a 3% incentive and potentially increase it to over 8%, fostering a mutually beneficial environment for PLI firms, the supply chain, and the nation as capacities for sub-assemblies/components expand, Mohindroo stated.

Source: daijiworld.com