India’s electronics manufacturing sector has recorded a significant milestone, with domestic value addition rising to nearly 18–20 percent, marking a major shift in the country’s industrial capabilities. This latest development reflects the success of sustained policy interventions and a focused push towards localization across the electronics value chain. From mobile phones to critical components and sub-assemblies, India is steadily reducing its reliance on imports while strengthening its position as a global manufacturing hub.
The growth comes amid a broader expansion in production and exports, driven largely by government initiatives such as the Production Linked Incentive (PLI) scheme. Over the past decade, India’s electronics production has surged nearly sixfold, while exports have witnessed exponential growth. This transformation is not just about scale but also about depth, as domestic manufacturing increasingly captures more value within the country.
For policymakers, industry leaders, and global investors, this shift signals a turning point. It highlights India’s growing competitiveness in electronics manufacturing and its ambition to become a key player in the global supply chain.
India’s electronics manufacturing ecosystem is undergoing a structural transformation, with domestic value addition reaching between 18 and 20 percent, according to recent government data. This marks a notable improvement from earlier years when a significant portion of value creation was dependent on imports.
The rise in value addition indicates that more components, sub-modules, and materials are now being produced domestically rather than sourced from overseas markets. This shift is critical for enhancing supply chain resilience, especially in a global environment increasingly defined by geopolitical uncertainties and trade disruptions.
Officials from the Ministry of Electronics and Information Technology have attributed this progress to a comprehensive approach that focuses on building the entire value chain. This includes not only finished products but also key inputs such as semiconductors, components, and capital equipment.
India’s electronics production has expanded dramatically over the past decade. From approximately Rs 1.9 lakh crore in 2014-15, the sector has grown to nearly Rs 12 lakh crore in 2024-25. This sixfold increase reflects both rising domestic demand and India’s growing integration into global supply chains.
The transformation did not happen overnight. It has been the result of sustained policy support and strategic planning over more than a decade.
Between 2014 and 2018, the government laid the groundwork by introducing policies aimed at improving ease of doing business and attracting foreign investment. The launch of flagship initiatives such as Make in India created a favorable environment for manufacturing.
The next phase began with the introduction of the Production Linked Incentive scheme, which provided financial incentives to companies for increasing production within India. This policy shift marked a turning point, encouraging both domestic and global firms to invest in local manufacturing capabilities.
By 2020, India had already begun to see significant growth in mobile phone manufacturing, which emerged as a key driver of the sector. Over the following years, this growth extended to other segments, including consumer electronics and components.
The Production Linked Incentive scheme has been central to India’s electronics manufacturing success story. Designed to boost large-scale manufacturing, the scheme has exceeded expectations in terms of investment, production, and exports.
As of early 2026, total investments under the scheme have crossed Rs 17,500 crore, while production has surpassed Rs 11 lakh crore. Exports have also seen a significant boost, reaching over Rs 6.2 lakh crore.
One of the most notable achievements has been the emergence of smartphones as India’s top export category in 2025. This marks a significant shift from traditional export sectors and underscores the country’s growing capabilities in high-value manufacturing.
According to a report by the Ministry of Electronics and Information Technology the steady increase in domestic value addition is a key indicator of successful localization efforts.
The scheme has also contributed to job creation, with more than 1.85 lakh direct employment opportunities generated so far. This has had a positive ripple effect on ancillary industries, including logistics, packaging, and component manufacturing.
Industry experts believe that the PLI scheme has fundamentally altered the economics of manufacturing in India. By providing targeted incentives, it has reduced the cost disadvantages that previously deterred large-scale production.
A study by the India Electronics and Semiconductor Association highlights that policy consistency and long-term incentives have played a crucial role in attracting global players.
Experts also point out that the next phase of growth will depend on deepening the ecosystem further. This includes investing in semiconductor fabrication, research and development, and advanced manufacturing technologies.
Among all segments, mobile phone manufacturing has been the standout performer. Production in this category has increased from just Rs 18,000 crore in 2014-15 to over Rs 5.45 lakh crore in 2024-25.
This exponential growth has positioned India as one of the largest mobile manufacturing hubs in the world. Several global brands have established or expanded their production facilities in the country, leveraging both domestic demand and export opportunities.
The success of mobile manufacturing has also created a foundation for expanding into other electronics segments. As component manufacturing scales up, the sector is expected to achieve higher levels of value addition in the coming years.
The rise in domestic value addition has far-reaching implications for India’s economy. By reducing dependence on imports, the country can improve its trade balance and strengthen its currency position.
From a global perspective, India’s emergence as an electronics manufacturing hub offers an alternative to existing supply chains, particularly in Asia. This diversification is increasingly important as companies seek to mitigate risks associated with over-reliance on a single region.
Data released by the World Bank suggests that countries investing in manufacturing ecosystems tend to achieve higher economic growth and employment generation over the long term.
For India, the challenge will be to sustain this momentum while addressing bottlenecks such as infrastructure, logistics, and skill development.
Looking ahead, the focus is likely to shift towards increasing value addition beyond the current 20 percent level. This will require deeper integration of component manufacturing, semiconductor production, and advanced technologies.
The government is expected to introduce new policy measures aimed at strengthening the electronics ecosystem further. These may include additional incentives for research and development, as well as support for startups in the hardware sector.
Industry stakeholders also emphasize the importance of collaboration between the public and private sectors. By working together, they can address challenges and unlock new opportunities for growth.
As India continues its journey towards becoming a global electronics powerhouse, the recent milestone in value addition serves as a strong indicator of progress. It reflects not only the success of past policies but also the potential for future expansion.