India’s electronics manufacturing sector is undergoing a seismic shift, transforming from an import-dependent market to a global production hub. India’s electronics sector is racing toward $500 billion by 2030, fueled by PLI schemes and global supply chain shifts. From importing 80% of phones a decade ago, India now makes 99% locally, with Apple and Samsung expanding production. The ₹76,000 crore Semicon India Programme aims to build chip fabs, while PCB manufacturing grows at 30% CAGR. Challenges remain in infrastructure and skills, but with 5G, EVs and IoT driving demand, India’s tech future shines bright.
A decade ago, India imported nearly 80% of its electronics. Today, it’s the world’s second-largest smartphone manufacturer, with giants like Apple, Samsung, and Foxconn setting up massive factories. Electronics manufacturing in India is no longer a distant dream—it’s a $500 billion opportunity by 2030.
With a 25-30% CAGR, the sector is outpacing global growth rates. Government initiatives & facilities to foster process smooth and swift India has introduce incentives like Production Linked Incentive (PLI) India, increased domestic demand, and global supply chain shifts are making this transformationto become reality. But the Question is how did India becoming a Leading giant for PCB manufacturing in India, semiconductors, and consumer electronics? Let’s find out.
India’s electronics manufacturing sector is skyrocketing, aiming for a $500 billion valuation by 2030 with a 25-30% CAGR. Government initiatives, surging domestic demand, and global investments are transforming India into a tech powerhouse. This blog explores the key drivers, opportunities, and future prospects of this booming industry, offering insights for businesses, investors, and tech enthusiasts.
Why Is India’s Electronics Sector Booming?
India’s electronics industry is thriving and growing vastly due to a perfect blend of factors. Increasing consumer demand, supportive policies, and global supply chain shifts are key. The sector, currently valued at 4% of the global market, is projected to reach 6% by 2030, driven by strategic initiatives like the Production Linked Incentive (PLI) scheme and Make in India that propelled its growth rate.
The domestic market, fueled by a growing middle class and digital adoption, demands smartphones, laptops, and IoT devices. Meanwhile, global companies like Samsung and Foxconn are setting up mega-factories in India, attracted by low labor costs and improved infrastructure.
Quick Fact: India’s electronics exports grew at a 26% CAGR from FY16 to FY25, showcasing its rising global influence.
Government Policies Fueling Growth
The Indian government is a major catalyst. The PLI scheme offers financial incentives to manufacturers, attracting giants like Apple and Xiaomi. The Semicon India Programme, with a ₹76,000 crore package, boosts semiconductor production. Special Economic Zones (SEZs) in Tamil Nadu and Karnataka provide world-class infrastructure, making India a cost-effective manufacturing hub.
Corporate tax cuts to 15% for new units and the “China +1” strategy further enhance India’s appeal. These policies reduce import reliance, aligning with the Atmanirbhar Bharat vision.
The Rise of PCB and Component Manufacturing
Printed Circuit Board Assemblies (PCBAs) are a cornerstone of India’s electronics growth. Demand for PCBAs is Projected to hit $139 billion by 2030, growing at a 30% CAGR. Historically reliant on imports, India is now localizing production, with imports of mobile PCBAs dropping from ₹300 billion in FY18 to nearly zero in FY24.
Other components, like compressors and copper tubes, are all set in motion to manufacture domestically. By year 2027, India aims to produce all RAC compressors domestically, downscaling import dependency from 8.5 million units in FY24.
Take smartphones, for example. In 2014, India imported 78% of its mobile phones. Today? Over 99% are made locally, thanks to policies like the Production Linked Incentive (PLI) scheme, which dangled $2 billion in incentives to lure giants like Apple and Samsung. The result? Factories sprouted overnight. Foxconn, the maker of iPhones, now employs over 40,000 workers in Tamil Nadu alone.
But it’s not just phones. PCB manufacturing in India, once a backwater, is now thriving. A few years ago, India imported nearly all its printed circuit boards (PCBs)—the “brains” inside every gadget. Today, thanks to tariffs on imports and PLI perks, local production is booming. One factory I visited in Sriperumbudur, near Chennai, was churning out 50,000 PCB units a day for global brands.
Local Supply Chains: A Game Changer
Localizing supply chains is critical. India’s overall component demand is projected to reach $240 billion by 2030. By boosting domestic production, India cuts costs, creates jobs, and strengthens its global supply chain role. Electronics manufacturing clusters and skill development programs ensure scalability and quality.
Example: A Tamil Nadu-based factory I visited last year was producing PCBAs for global brands, employing 2,000 skilled workers and operating at 90% capacity.
India’s Semiconductor Market: A Fivefold Leap
India’s semiconductor consumption is set to jump from $22 billion in 2019 to $110 billion by 2030, with a 16% CAGR. The government’s focus on chip fabrication and packaging aims to capture 10% of global demand. Partnerships with global leaders like TSMC are accelerating this shift.
The Semicon India Programme is a game-changer, drawing investments and fostering R&D. This positions India as a semiconductor hub, critical for smartphones, EVs, and IoT devices.
Now, here’s where things get really ambitious. Semiconductors—the tiny chips that power everything from cars to AI—are the holy grail of electronics. Today, India consumes 22 billion worth of chips annually. By2030,demandwillhit∗∗22billionworthofchipsannually,.By2030,demandwillhit∗∗110 billion.
The government isn’t sitting idle. The Semicon India Programme, with a ₹76,000 crore ($10 billion) war chest, aims to build India’s first chip factories. Will it work? Skeptics point out that Taiwan and South Korea took decades to dominate this space. But optimists argue India has two aces: a massive domestic market and cheaper labor. If even 10% of global chip production shifts here, it could be a game-changer.
Challenges in Semiconductor Growth
Despite progress, challenges remain. Building semiconductor fabs requires massive capital and expertise. India must also compete with established hubs like Taiwan and South Korea. However, government incentives and a skilled workforce provide a strong foundation.
Key Sectors Driving Electronics Growth
Several sectors are propelling India’s electronics boom:
- Consumer Electronics: Smartphones, TVs, and laptops lead the charge, with 99% of phones sold in India now made locally.
- Automotive Electronics: Electric vehicles (EVs) demand advanced electronics like battery management systems.
- Telecom and IoT: The 5G rollout fuels demand for telecom equipment and IoT devices.
- Industrial Electronics: Automation and smart manufacturing drive component needs.
These sectors benefit from India’s cost-effective labor and growing R&D ecosystem, making it a hotspot for innovation.
Sustainability in Manufacturing
Sustainability is gaining traction. Manufacturers are adopting energy-efficient processes to meet global carbon goals. For instance, a Karnataka-based plant I toured used solar power for 40% of its operations, cutting costs and emissions.
India’s Role in the Global Supply Chain
India is emerging as a key player in the global electronics supply chain. The “China +1” strategy, where companies diversify from China, has driven investments from Foxconn, Wistron, and Pegatron. India’s skilled workforce and infrastructure improvements make it a viable alternative.
Mobile phone production is a standout. India is now the world’s second-largest producer, with exports surging 77 times in a decade. This growth extends to consumer and industrial electronics, positioning India as an export hub.
Case Study: Mobile Phone Manufacturing
In 2016, India imported more electronics than it produced. By FY24, local production outpaced imports by 24%. Policies like the Phased Manufacturing Program (PMP) and higher import duties on PCBAs drove this shift, creating a robust ecosystem.
The Future of Electronics Manufacturing in India
By 2030, India’s electronics sector is poised for exponential growth. Key trends include:
- 5G and IoT Expansion: Demand for advanced telecom equipment will soar.
- EV Market Growth: Sophisticated electronics for EVs will drive innovation.
- Digitalization and Automation: Smart manufacturing will enhance efficiency.
- R&D and Startups: India’s startup ecosystem will push hardware and IoT innovation.
Value addition in electronics manufacturing, now at 70%, is projected to hit 90% by FY27. Component value addition will rise from 15-16% to 40-50%, driven by new policies.
Opportunities for Businesses
For businesses, India offers immense potential. Setting up manufacturing units provides access to a massive consumer base and export markets. Investors can tap into high-growth sectors like semiconductors and EVs. However, navigating regulatory hurdles and investing in skilled labor are crucial.
Challenges to Overcome
While the outlook is bright, challenges persist:
- Infrastructure Gaps: Logistics and power supply need further improvement.
- Skill Development: High-tech manufacturing demands continuous training.
- Global Competition: India must differentiate itself from rivals like Vietnam.
- Capital Intensity: Semiconductor and component manufacturing require heavy investment.
Addressing these will solidify India’s position as a global leader.
How Can India Achieve Self-Reliance?
To achieve self-reliance, India must focus on:
- Local Supply Chains: Expand domestic production of PCBAs and semiconductors.
- Semiconductor Fabs: Build advanced facilities to meet global demand.
- Workforce Skilling: Train engineers and technicians for high-tech roles.
- R&D Investment: Foster innovation through public-private partnerships.
Collaboration between government, industry, and academia is key. For example, a recent initiative in Uttar Pradesh trained 5,000 youth for electronics roles, boosting employability.
Conclusion
India’s electronics manufacturing sector is on a meteoric rise, targeting $500 billion by 2030. Government policies, local supply chains, and global demand are driving this transformation. From PCBAs to semiconductors, India is reducing import reliance and emerging as a global tech hub. Businesses and investors have a golden opportunity to join this journey, but addressing challenges like infrastructure and skilling is critical.
As India embraces 5G, EVs, and IoT, its role in the global electronics landscape will only grow. The future is bright, and India is ready to lead.
