Government targets 80% local value addition in IT gear in 5-10 years

economictimes.indiatimes.com:

India to 60-80% in the next five-ten years, people aware of the development told ET. A primary request of the government is that industries operating in India look to implement new production techniques, such as surface-mount technology (SMT) lines, to step up the local value-addition percentage, one of the people said. “So, for example, in the IT hardware production-linked incentive (PLI) scheme, the government wants the industry to go beyond the assembly of components.

Their ask is to make the printed circuit boards (PCBs) locally. If we make the motherboard here, that will give a big boost to local value addition,” an industry executive who attended a meeting with officials of the Ministry of Electronics and Information Technology told ET. Some other industry executives said the development of an ecosystem around electronics hardware manufacturing is still nascent in India and could take more than 24 months to develop fully.

“Most laptop makers right now get the components in strips which need to be soldered on the circuit board. It is an automated process which needs SMT lines to be set up in India. The industry is now looking to start that,” said an executive.

Some of the companies, which are applicants under the IT hardware PLI scheme, have already started the groundwork for manufacturing components like PCBs, people in the know said. “The packaging, India-specific sockets, keycaps, panel covers and to an extent even the display is being made here. Brands have various levels of expertise in localising these components,” one of the people said.