India Approves $4.6 Billion To Boost Electronics Supply Chain

India has approved $4.6 billion in electronics component investments as the Narendra Modi government steps up efforts to build local supply chains and challenge China.

The Ministry of Electronics and Information Technology cleared 22 proposals under its Electronics Components Manufacturing Plan, projected to generate 2.58 trillion rupees ($28.6 billion) in output, according to a government statement on Friday.

The approved projects include those from heavyweights such as Samsung and Tata Electronics and cover manufacturing of 11 targeted products used in mobile phones, telecom equipment, consumer electronics, automotive and IT hardware.

The projects are expected to strengthen domestic supply chains and curb import dependence, the ministry said. The Modi government is pushing to localize production of high-value sub-assemblies such as camera and display modules to better shield India’s electronics supply chain from external shocks. 

The move comes as Apple Inc. expands the number of local factories assembling iPhones after shifting most US-bound production to India from China to reduce tariff risks. While India faces some of the highest US tariff rates globally, electronic goods have so far been spared steeper levies.

In November, the government cleared a proposal to set up a unit to make mobile phone enclosures or metal casting by Aequs, which is an Apple supplier.

Four fab manufacturing facilities will start commercial production this year, including those of Micron and Tata, the Electronic Minister Ashwini Vaishnaw added on Friday.