Smartphone Makers Seek Extension on PLI Scheme

India's mobile phone manufacturers are calling on the government to extend the Production-Linked Incentive (PLI) scheme for smartphones beyond its scheduled expiration in 2026. Industry leaders believe that continuing the scheme is crucial for fostering greater local value addition, encouraging product design innovation, and strengthening India’s position as a global manufacturing hub.  

The PLI scheme, launched in 2020, has already attracted global players and elevated India as a significant player in smartphone manufacturing. However, Sunil Vachani, the outgoing president of the Consumer Electronics and Appliances Manufacturers Association (CEAMA) and chairman of Dixon Technologies, pointed out that while the scheme has achieved many of its objectives, more work remains. He explained that extending the scheme would provide additional time for companies to establish operations, advance product design, and take advantage of shifting global trade dynamics.  

India’s strategic role as an alternative manufacturing base to China is becoming more evident due to geopolitical shifts. Vachani noted that recent global developments, particularly in the US, have sparked increased interest from international manufacturers looking to invest in India.  

Industry leaders are advocating for the next phase of the PLI scheme to focus on new objectives. These include linking incentives to higher levels of local value addition, encouraging job creation, and driving local product design capabilities to reduce dependence on imports. Sanjeev Agarwal, Chief Manufacturing Officer at Lava International, emphasized the importance of rewarding companies that make greater efforts to localize components and production processes.  

Extending the PLI scheme is also considered vital for achieving the Indian government’s ambitious target of producing $500 billion worth of electronics by 2030. By incentivizing deeper integration into the electronics value chain and supporting local manufacturing and design efforts, the scheme would ensure India remains a competitive alternative in the global supply chain, fostering economic growth and innovation.