Electronics component makers seek Rs 72,500 cr financial package to cut reliance on imports

Electronics component makers' body Elcina has sought a Rs 72,500 crore (USD 8.57 billion) support package to boost local production of raw materials and cut reliance on imports, an industry official said.

Electronic Industries Association of India (Elcina), the country’s oldest industry body of the Indian electronics sector, estimates that the demand-supply deficit for inputs in the electronics segment will increase to USD 248 billion (about Rs 21 lakh crore) by 2030 to cater to projected USD 500 billion electronics production, and it would be met largely by imports. The industry body expects that the government’s support for non-semiconductor components can help reduce the deficit in the country by USD 146 billion (Rs 12.36 lakh crore) to USD 102 billion (Rs 8.63 lakh crore).

Elcina Secretary General Rajoo Goel told PTI that unlike finished products where the factory output can go up to 16 times the investment, an electronic components factory can at the most generate an output of three times the invested capital. “People hesitate to expand their investment in electronic components due to low return, high operational cost, and long gestation period. Therefore, we have requested the government for USD 8.57 billion comprising USD 2.14 billion for capex to encourage expansion of the industry and USD 6.43 billion as PLI,” Goel said.

The government is actively considering a comprehensive package to support the production of non-semiconductor electronic components. Elcina has included miniature electronic components, printed circuit boards, some discrete semiconductors, active components, metallic components, etc., in the estimates. According to the industry body, the components for which support is required account for 60 per cent of the total cost of a finished product.