India Accelerates Push to Become Global Manufacturing Hub as Semiconductor and Electronics Investments Rise
— From domestic component production to Semicon 2.0, the focus shifts to execution
New Delhi: India is stepping up efforts to become a major global manufacturing hub, driven by fresh investments in electronics components, semiconductor production and technology infrastructure. Government-backed incentive schemes are helping companies expand domestic production, strengthen supply chains and create new employment opportunities.
Recent figures indicate that electronics manufacturing has grown significantly over the past decade, while new semiconductor projects are expanding the country's capacity in chip production, packaging and design.
Electronics Manufacturing Records Strong Growth
According to the Ministry of Electronics and Information Technology, India's electronics production jumped from ₹1.9 lakh crore in 2014–15 to ₹13.11 lakh crore in 2025–26. Electronics exports also rose from over ₹38,000 crore to ₹4.24 lakh crore during the same period.
This growth reflects India's expanding role in mobile phone manufacturing, electronic components and other technology-related products. The government is now focusing on strengthening the domestic supply chain so manufacturers can source more components and materials locally rather than relying heavily on imports.
₹69,548 Crore Investment Approved for Electronics Components
The Electronics Components Manufacturing Scheme (ECMS) has emerged as a major part of this strategy. As of August 2026, the government had approved 106 projects across 15 states, involving a projected investment of ₹69,548 crore.
These projects are expected to generate production worth approximately ₹5.34 lakh crore, while creating 74,628 direct jobs and around 2.5 lakh indirect employment opportunities.
The scheme covers a wide range of products, including printed circuit boards, camera modules, electronic sub-assemblies, optical transceivers and other components required by manufacturers. Under the Union Budget 2026–27, the scheme's financial outlay was increased to ₹40,000 crore.
Semiconductor Industry Gets a Major Policy Push
Semiconductors are essential for smartphones, computers, electric vehicles, telecommunications equipment, data centres and artificial intelligence systems. India has been working to establish a stronger domestic ecosystem through government incentives and partnerships with technology companies.
On July 15, 2026, the Union Cabinet approved Semicon 2.0 with a total outlay of ₹1,27,500 crore. The programme aims to expand capabilities in chip design, semiconductor manufacturing, advanced packaging, research, equipment and materials.
According to official information, 12 semiconductor manufacturing units had been approved under the earlier programme, involving cumulative investments of more than ₹1.64 lakh crore. These include silicon and silicon carbide fabrication facilities, a gallium nitride micro-LED display fabrication facility and nine semiconductor packaging units.
Production-Linked Incentives Support Industrial Expansion
The Production-Linked Incentive (PLI) scheme provides incentives to eligible companies based on specified production and sales criteria. It supports large-scale electronics manufacturing, mobile phones and information technology hardware.
Alongside PLI, the government is encouraging investment in industrial infrastructure, electronics manufacturing clusters, research facilities and workforce training. These measures are intended to make it easier for companies to establish factories, access suppliers and expand production for both domestic and international markets.
- Electronics production: ₹1.9 lakh crore (2014–15) to ₹13.11 lakh crore (2025–26).
- ECMS projects: 106 approved across 15 states, totalling ₹69,548 crore in investment.
- Job creation: 74,628 direct and ~2.5 lakh indirect jobs expected.
- Semicon 2.0: ₹1,27,500 crore outlay approved on July 15, 2026.
- Existing units: 12 semiconductor manufacturing units approved under the previous phase.
Jobs and Domestic Supply Chains in Focus
The expansion of manufacturing could benefit workers, engineers, component suppliers and small businesses connected to industrial supply chains. Electronics component production is particularly important because it allows more value to be added within India.
Domestic suppliers can provide parts to mobile phone makers, automobile companies, telecommunications manufacturers and other industries. However, the long-term benefits will depend on how quickly approved projects become fully operational, how much technology is transferred to domestic businesses and whether Indian suppliers can meet global standards for cost, quality and reliability.
Challenges Remain
Despite the progress, India faces competition from established manufacturing centres in China, Taiwan, South Korea and other Asian economies.
Semiconductor manufacturing also requires substantial capital, specialised equipment, reliable electricity, high-quality water supplies and highly trained workers. Building a complete supply chain for advanced chips can take years. India will therefore need sustained investment in research and development, technical education, logistics and industrial infrastructure to compete more effectively in global markets.
Outlook
India's growing electronics production, new component-manufacturing projects and expanded semiconductor programme indicate a broader effort to strengthen its industrial base.
The next major test will be converting announced investments into operating factories, higher domestic value addition and sustainable job creation.