Union Cabinet approves Rs 17,000 Cr PLI package for hardware sector

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

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

"For IT PLI, the budgetary outlay is Rs 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.

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

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 Rs 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 Rs 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.