Cabinet Approves Rs 229.19 Billion ECM Scheme

29 Mar 2025 CW Team

The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the Electronics Component Manufacturing Scheme with a funding of Rs 229.19 billion to strengthen India’s electronics supply chain and promote self-reliance (Atmanirbhar Bharat) in the sector.

Objective & benefits

The scheme aims to build a robust component ecosystem by attracting global and domestic investments, increasing domestic value addition (DVA), and integrating Indian manufacturers into global value chains (GVCs). It is expected to generate:

• Rs 593.5 billion in investments

• Rs 4,565 billion in production output

• 91,600 direct jobs, along with significant indirect employment opportunities

Key features of the scheme

• Targeted incentives: Custom-designed incentives for different component categories and sub-assemblies to help Indian manufacturers achieve technological capabilities and economies of scale.

• Six-year duration: The scheme will run for six years, with a one-year gestation period.

• Employment-linked incentives: A portion of the incentive is tied to job creation targets.

Industry growth & background

The electronics sector is among the fastest-growing industries globally and is critical to economic and technological advancement. Over the past decade, India’s electronics manufacturing sector has witnessed remarkable growth:

• Domestic production surged from Rs 1.90 trillion (FY 2014-15) to Rs 9.52 trillion (FY 2023-24), growing at a CAGR of over 17%.

• Electronics exports increased from Rs 0.38 trillion (FY 2014-15) to Rs 2.41 trillion (FY 2023-24), with a CAGR exceeding 20%.

The scheme is set to accelerate India’s emergence as a global hub for electronics manufacturing, ensuring a stronger, more self-sufficient supply chain.

(PIB)

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