The Ministry of Electronics and Information Technology (Meity) approved 31 new electronics manufacturing projects worth ₹7,877 crore last week, bringing the total number of ECMS approvals to 106 projects. According to reports from Business Standard, these projects span 10 states and 20 products including filters, coils, speakers and battery materials. The approved projects are expected to generate ₹82,243 crore in production and create 9,588 direct jobs. With the latest approvals, 106 applications covering 30 products across 15 states have been cleared, representing ₹69,548 crore of investment and projected production of ₹5.34 trillion, with 74,628 direct jobs expected. The scheme represents India's next phase of manufacturing push, moving beyond assembly to components, materials and equipment manufacturing.
According to Sujay Shetty, partner at PwC India, the ECMS scheme is a well-designed intervention that offers turnover-linked, capex-linked and hybrid incentives calibrated to each segment's economics. As reported by Business Standard, the scheme recognizes that different components have very different capital, scale and gestation profiles. Shetty noted that the response from companies has been strong, stating that on mobilizing investment into a segment India struggled to build for two decades, ECMS is delivering. The scheme includes India's first domestic manufacturing proposals for several critical components, with the latest approvals covering camera, display and optical-transceiver modules; connectors, transducers, speakers, microphones, relays, antennas, coils, filters and capacitors; as well as anode material, rare-earth permanent magnets, acetylene black and electrolyte additives. The ECMS was given a ₹40,000-crore outlay in the Union Budget 2026-27, with the turnover-linked incentive running for six years including a one-year gestation period, while the capex incentive operates for five years.
India's semiconductor manufacturing sector has achieved remarkable progress with the Semicon 2.0 programme approved in July 2026 with a total budget outlay of ₹1,27,500 crore. As of July 2026, twelve manufacturing units have been approved with investments exceeding ₹1.64 lakh crore, including one silicon fab, one silicon carbide fab, an integrated Gallium Nitride Micro LED display fab, and nine packaging units. These facilities are expected to meet chip requirements across consumer appliances, industrial electronics, automobiles, power electronics, telecommunications, and aerospace sectors. Out of the twelve approved proposals, three companies - Micron, Kaynes, and CG Semi have already started commercial production, with one more company expected to begin operations in 2026. This builds on the Semicon India Programme (Semicon 1.0) approved in December 2021 with an outlay of ₹76,000 crore.
Despite significant growth in electronics production, India faces substantial import dependency that the ECMS aims to address. According to Business Standard, India's electronics production rose from ₹1.9 trillion in 2014-15 to ₹13.11 trillion in 2025-26, while electronics exports increased from ₹38,000 crore to ₹4.24 trillion. However, domestic value addition in electronics manufacturing remains at only 18-20%, as industry estimates cited by the Ministry of Electronics & IT show. The biggest challenge lies in semiconductors, with India importing $30 billion worth of electronic integrated circuits in FY26. As per Crisil's August 2026 analysis, electronics was among India's three most import-intensive manufacturing sectors, with imports accounting for 29.8% of total supply. According to KPMG India's May 2026 analysis, India remains dependent on imports for 90-95% of its semiconductor and component requirements, with China, Taiwan, South Korea and Singapore among the key sources. This puts Indian manufacturers up against supply chains that have greater upstream integration, creating structural cost disadvantages.
Experts emphasize that while subsidies can help Indian manufacturers overcome initial cost and scale disadvantages, the real test lies in achieving sustainable competitiveness after government support ends. As reported by Business Standard, Bharath Krishna Rao from Emobi noted that component manufacturing involves high upfront capital expenditure and requires time to develop products, qualify them with customers and secure repeat orders - a process that can take one year to five years or more. Pranav Chopra from Optimist highlighted that Indian component manufacturers are still carrying early costs of building an ecosystem that Chinese manufacturers have amortized over decades, requiring subsidies to phase out as the ecosystem reaches scale. The transition cannot be based solely on fixed timeframes but depends on whether Indian component manufacturing has achieved the scale and ecosystem depth needed to compete without government support. Experts converge on the practical requirement that Indian manufacturers must compete on cost, quality, scale and reliability while reducing dependence on imported inputs, improving manufacturing efficiency, and developing deeper domestic supplier ecosystems.
