Government clears 16 companies for product-linked incentive scheme – ETtech

Government clears 16 companies for product-linked incentive scheme
The government, on Tuesday, approved applications of 16 electronics companies including 10 mobile phone manufacturers for reward under the product-linked incentive scheme for total disbursement of Rs 40,000 crore.

The international mobile phone manufacturing companies that are approved to avail incentive for producing mobile phones with invoice value Rs 15,000 and above are Samsung, Foxconn Hon Hai, Rising Star, Wistron and Pegatron.

Out of these, 3 companies namely Foxconn Hon Hai, Wistron and Pegatron are contract manufacturers for Apple iPhones. Apple (37%) and Samsung (22%) together account for nearly 60% of global sales revenue of mobile phones and this scheme is expected to increase their manufacturing base manifold in the country.

Domestic mobile phone makers who have been approved by the ministry of electronics and IT (MeitY) are Lava, Bhagwati (Micromax), Padget Electronics, UTL Neolyncs and Optiemus Electronics who have proposed production output worth Rs 1.25 lakh crore over the next five years, the ministry said in a statement.

Six companies are approved under the Specified Electronic Components Scheme which include AT&S, Ascent Circuits, Visicon, Walsin, Sahasra, and Neolync.

The selected manufacturers are expected to generate Rs 10.5 lakh crore worth of total production, of which 60% would be exported. Out of total, production of Rs 9 lakh crore is expected from handset makers alone. Those under Specified Electronic Components segment have proposed a production of over INR 15,000 crore.

The companies themselves will invest Rs 11,000 crore in Indian electronics manufacturing industry.

“The scheme will generate more than 2 lakh direct employment opportunities in next 5 years along with creation of additional indirect employment of nearly 3 times the direct employment,” MeitY said.

Domestic Value Addition is expected to grow from the current 15-20% to 35-40% in case of mobile phones and 45-50% for electronic components.

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