Mobile Manufacturing: Govt Clears PLI Incentives Of Rs 415 Crore For Foxconn, Padget Electronics

The NITI Aayog CEO led Empowered Committee has approved incentives of Rs 415.46 crore for two companies for mobile manufacturing under the Production Linked Incentive (PLI) scheme for Large Scale Electronics Manufacturing (LSEM).

Foxconn Hon Hai Technology India Mega Development Private Limited, a subsidiary of Taiwanese contract manufacturer Foxconn, has been approved for receiving an incentive of Rs 357.17 crore ($43.2 million) for the period from August 2021 to March 2022 based on its incremental investments and sales figures.

Apple supplier Foxconn is the first global company that has been approved under the target segment ‘Mobile Phones’ (category: invoice value Rs 15,000 and above) to receive incentive under mobile manufacturing, the NITI Aayog said in a statement on Tuesday (20 December).

Padget Electronics Pvt Ltd, a domestic company, was approved for getting an incentive of Rs 58.29 crore ($7.05 million) for the quarter January to March 2022, based on its incremental investments and sales figures under the target segment ‘Mobile Phones’ (category-domestic companies). 

Padget Electronics, a 100 per cent subsidiary of Dixon Technologies, has manufacturing facilities in Noida, Uttar Pradesh. The company had already received an amount of Rs 53.28 crore under the PLI scheme for Large-Scale Electronics Manufacturing for the period August–December 2021 based on its incremental investments and sales figures.

The proposals for disbursement of incentives, presented by Ministry of Electronics and IT, were considered by the Empowered Committee, comprising NITI Aayog CEO Param Iyer, DPIIT Secretary Anurag Jain, MeitY Secretary Alkesh Kumar Sharma, and other members of the Empowered Committee, the release said.

The PLI scheme for LSEM aims to make India a competitive destination for electronics manufacturing and provide a boost to the Atmanirbhar Bharat initiative while creating more global champions in the sector.

As of September 2022, the PLI scheme has attracted investment of Rs 4,784 crore ($578.6 million) and led to total production of Rs 2,03,952 crore ($24.67 billion), including exports of Rs 80,769 crore ($9.77 billion). The scheme has also generated employment for 40,916 people.

In the release, the NITI Aayog said that as a result of government initiatives and industry’s efforts, India has made rapid advances in the past five years in the field of electronics manufacturing. 

The PLI for Large-Scale Electronics Manufacturing sector has attracted leading global players, including Foxconn, Samsung, Pegatron, Rising Star and Wistron while leading domestic companies, including Lava, Micromax, Optiemus, United Telelinks Neolyncs and Padget Electronics, have also participated in this scheme.

The production of mobile phones has risen from about 6 crore in 2014-15 to around 31 crore in 2021-22. 

The export of mobile phones has also seen a sharp increase, with India exporting Rs 45,000 crore worth of mobile phones in FY 2021-22.

During the current year up to November 2022, mobile phone exports have already crossed Rs 40,000 crore, which is more than double the exports made during the same period last year, the release said.