India is undergoing a digital revolution that has fuelled a surge in the consumption of electronic devices. This demand growth is driven by an expanding middle-class population, rising disposable incomes, and declining electronics prices. As a result, India has emerged as one of the largest consumer electronics markets in the Asia-Pacific region and a hub for electronic chip design and embedded software.
The Electronics System Design & Manufacturing (ESDM) sector has been expanding rapidly. It was projected to reach about US$ 220 billion by FY25, growing at a 16.1% CAGR between 2019 and 2025. Looking ahead, India is targeting electronics manufacturing output of Rs. 43,10,000 crore (US$ 500 billion) by FY30, which requires a fivefold increase in production and is expected to generate 12 million jobs by FY27. The government has further committed to achieving US$ 300 billion worth of electronics manufacturing and US$ 120 billion in exports by FY26. In FY25 alone, India’s electronics exports rose to US$ 38.56 billion, registering a growth of 20.4% YoY, led by mobile phones, IT hardware such as laptops and tablets, consumer electronics, industrial electronics, and auto electronics.
Indian manufacturers are attracting the attention of multinational corporations due to shifting global landscapes in electronics design and manufacturing capabilities, as well as cost structures. Companies from all over the world are striving to develop local capacities in India not only to serve the domestic market but also to cater to international markets. The cumulative FDI equity inflow in the electronics industry reached Rs. 64,079 crore (US$ 7.22 billion) during the period April 2000 to June 2025. Notably, India surpassed China as the leading smartphone exporter to the United States in Q2 FY26, validating the "China+1" strategy being adopted by multinational OEMs.
India witnessed a substantial spike in demand for electronic products in the last few years; this is mainly attributed to India's position as second-largest mobile phone manufacturer worldwide and surge in internet penetration rate. The smartphone segment has emerged as the backbone of India's ESDM industry, contributing 62% of the overall market in FY25, and growing at a robust CAGR of 28% between FY20 and FY25. The number of smartphone manufacturing units has expanded from just two in 2014 to over 300 in 2024, attracting significant global and domestic investments. The Government of India attributes high priority to electronics hardware manufacturing, as it is one of the crucial pillars of Make in India, Digital India, and Start-up India programs. The total budgetary allocation for the Ministry of Electronics and Information Technology (MeitY) in Union Budget FY26 stood at Rs. 26,026 crore (US$ 3.08 billion), reflecting an 18.64% increase over FY25.
As of December 2025, the Large-Scale Electronics Manufacturing (LSEM) scheme has attracted investments of Rs. 15,172 crore (US$ 1.71 billion) and generated 1,71,448 additional jobs. The PLI 2.0 scheme for IT hardware, covering laptops, tablets, and servers, has led to cumulative production of Rs. 16,531 crore (US$ 1.87 billion), with investments of Rs. 856.64 crore (US$ 0.10 billion) and the creation of 4,776 direct jobs. Overall, cumulative production under the PLI scheme reached Rs. 10.39 lakh crore (US$ 117.4 billion) by December 2025.
Semiconductors remain central to this growth story. According to the India Electronics & Semiconductor Association (IESA), over 90% of global semiconductor companies have research and development centres in India. This segment generates US$ 2.5 billion in revenue and provides employment to about 600,000 people. Complementing this, the government has allocated Rs. 8,803 crore (US$ 1.06 billion) under schemes to promote semiconductor and electronic component manufacturing.
Foreign investments have also played a critical role. The cumulative FDI equity inflow in the Electronics industry is Rs. 64,079 crore (US$ 7.22 billion) during the period April 2000-June 2025. Strategic corporate moves are reshaping the sector as well. The Competition Commission of India recently approved Tata Electronics’ acquisition of shareholding in Pegatron Technology India Pvt. Ltd. and the transfer of TEL Components Pvt. Ltd.’s business undertaking to Pegatron India.
Government support continues through initiatives like Digital India and Make in India, along with favourable FDI policies and the creation of Electronics Manufacturing Clusters (EMCs) to provide world-class infrastructure. Reflecting this policy push, the budgetary allocation for the Ministry of Electronics and Information Technology (MeitY) in FY26 stood at Rs. 26,026 crore (US$ 3.08 billion), an increase of 18.64% over FY25 estimates.
Recent developments also highlight the growing integration of electronics into strategic industries. The Ministry of Defence finalized a Rs. 2,385 crore (US$ 282.1 million) contract with Bharat Electronics Limited for Electronic Warfare Suites and modification kits for Mi-17 V5 helicopters. In healthcare, SAMEER signed a MoU with AIIMS on the 32nd foundation day of AIIMS’ NMR department to collaborate on high-field and low-field MRI and NMR systems, as well as research in radio frequency and microwave technologies for medical applications.
Parallelly, India’s industrial activity reflects strong momentum. The Quick Estimates of the Index of Industrial Production (IIP) stood at 156.6 in May 2025, up from 154.7 in May 2024. Within this, the Mining, Manufacturing, and Electricity sectors posted indices of 136.3, 154.3, and 216.0 respectively.
Artificial Intelligence (AI) is also expected to complement the ESDM and the broader digital ecosystem, with the potential to add US$ 967 billion to the Indian economy by 2035 and US$ 450–500 billion to GDP by 2025, contributing 10% to India’s US$ 5 trillion GDP target.
The Union Budget 2026–27 announced an increased outlay of Rs. 40,000 crore (US$ 4.5 billion) for the Electronics Components Manufacturing Scheme (ECMS), signalling a strong policy push to deepen domestic manufacturing capacity. Additionally, Basic Customs Duty exemptions on key inputs for microwave ovens came into effect from February 2, 2026
The Union Budget 2026–27 marked a significant step with the announcement of India Semiconductor Mission (ISM) 2.0, with a provision of Rs. 1,000 crore (US$ 0.11 billion) for FY 2026–27. The initiative focuses on developing domestic capabilities in semiconductor equipment and materials, advancing full-stack Indian semiconductor intellectual property, and strengthening India’s position in global supply chains.
The IESA Technovation Awards, one of the most prestigious recognitions in India’s ESDM and semiconductor industry, were held at the IESA Vision Summit 2026 in Bengaluru on February 25–26, 2026. The summit, themed “Design to Manufacturing: Synergy of Product, Production and Skill,” underscored India’s growing ambition to emerge as a Product Nation, with support from leading industry players such as Applied Materials and Infineon Technologies.
The Government of India approved 22 proposals under the ECMS, led by major players including Foxconn (Yuzhan Technology India), Samsung Display, Tata Electronics, and Dixon Technologies, with a projected investment of Rs. 41,863 crore (US$ 4.76 billion) and expected production worth Rs. 2,58,152 crore (US$ 29.34 billion), generating 33,791 direct jobs across eight states.
As of December 2025, a total of 11 Electronics Manufacturing Cluster (EMC) projects and 2 Common Facility Centre (CFC) projects have been approved, covering 4,399.68 acres. The combined project cost stands at Rs. 5,226.49 crore (US$ 590.6 million), including Central financial assistance of Rs. 2,492.74 crore (US$ 281.9 million).
Under India’s Production Linked Incentive (PLI) scheme, electronics manufacturing particularly mobile phones recorded a significant production increase of 146% to Rs. 5.45 lakh crore (US$ 61.6 billion) in FY25, driven by strong investor interest and robust foreign direct investment inflows.
On November 17, 2025, the Government of India approved 17 projects under the Electronics Component Manufacturing Scheme (ECMS) with a combined investment of Rs. 7,172 crore (US$ 808 million), expected to generate production worth Rs. 65,111 crore (US$ 7.34 billion) across nine states in areas like multilayer PCBs, camera modules and optical transceivers.
On October 16, 2025, global technology firms LG Electronics and Samsung Electronics announced major R&D efforts in India, leveraging domestic engineering talent in semiconductor design, system-on-chip and AI-enabled technologies. The move highlights India’s transition from cost arbitrage to high-end capability, supported by government schemes such as the Semicon India Programme, Design Linked Incentive (DLI) Scheme and Chips to Startups (C2S) Scheme.
On July 17, 2025, Tata Electronics and German firm Robert Bosch GmbH signed a Memorandum of Understanding to collaborate on advanced chip packaging and semiconductor manufacturing at Tata’s new assembly facility in Assam and a foundry in Gujarat. They will also explore local electronic manufacturing services, especially for vehicle electronics.
On June 23, 2025, India’s central government approved Micron Semiconductor’s establishment of a Special Economic Zone in Sanand, Gujarat, covering 37.64 hectares with an investment of Rs. 13,000 crore (US$ 1.51 billion), aimed at boosting semiconductor and electronics manufacturing.
By July 2025, Renesas Electronics, in collaboration with CG Power and Stars Microelectronics, is set to complete its pilot Outsourced Semiconductor Assembly and Test facility in Sanand, Gujarat, with the first chip batch expected by mid-2026 and full production by October 2027, backed by a US$ 222 million investment.
On May 14, 2025, the Indian Union Cabinet approved the HCL-Foxconn joint venture to build a semiconductor plant near Jewar Airport, Uttar Pradesh, with a Rs. 3,706 crore (US$ 433.6 million) investment to produce display driver chips, targeting operational status by 2027.
On March 18, 2025, Malaysia’s Deputy Minister of Investment, Trade, and Industry, Mr. Liew Chin Tong, expressed interest in deeper collaboration with India’s semiconductor sector, highlighting areas like equipment, assembly, and testing during his visit to India.
Reliance Industries is set to build the world’s largest data centre in Jamnagar, Gujarat, marking a major step in its entry into India's artificial intelligence (AI) sector. The company has procured AI semiconductors from Nvidia to power this project following a collaboration announcement at October 2024 Nvidia AI Summit.
Apple is engaged in discussions with Bharat Forge to establish a partnership, potentially designating the company as a supplier for the manufacturing of components such as mechanical parts.
FollowG has introduced an AI-powered application for the Open Network for Digital Commerce (ONDC), designed to assist small and medium-sized electronics retailers by facilitating connections with buyers across the country.
In July 2023, electronics maker Elista announced that it would invest Rs. 100 crore (US$ 12.1 million) in Andhra Pradesh to set up a manufacturing unit for Smart LED TVs, smartwatches, audio speakers, and large appliances.
US CHIP design major Advanced Micro Devices (AMD) will invest up to US$ 400 million in India over the next five years and will set up its biggest design facility in the country.
The Index of Industrial Production of manufacturing of computer, electronic, and optical products (weight: 1.57%) was valued at 137, during FY23.
India's electronics sector is set to harness US$ 7 billion untapped revenue by 2035 via circular business model and policy pathways, industry stakeholders said. Current commitments and targets set the projected market size for these circular models at US$ 13 billion in 2035.
India is now the world’s second-largest mobile phone exporter, with exports rose 127 times from Rs. 1,500 crore (US$ 169 million) in 2014-15 to Rs. 2,00,000 crore (US$ 22.56 billion) in 2024-25.
The ‘Make in India’ initiative's mobile phone shipments from India exceeded 2 billion cumulative units and an annual growth rate of 23% was recorded.
According to a report 'India Monthly Wearable Device Tracker' by International Data Corporation (IDC), "hundreds" of" smartwatch model launches in the first half of the calendar year 2023 contributed to India's wearable market's growth of 53.3% year-over-year (YoY). The companies shipped 57.8 million units of wearables like smartwatches, earwear, and eyeglasses to the market in the first half of CY23.
The Ministry of Electronics and IT (MeitY) announced the exchange of signing of a Memorandum of Understanding (MoU) between the Centre for Nano Science and Engineering (CeNSE) at the Indian Institute of Science (IISc), Bengaluru and Lam Research India at the SemiconIndia in Gandhinagar.
India Semiconductor Mission organized a three-day SemiconIndia 2023 Conference in July 2023 with the theme ‘Catalysing India’s Semiconductor Ecosystem’ in Gandhinagar, Gujarat. In March 2023, the Government approved the setting up of the Electronics Manufacturing Cluster (EMC) at Hubli-Dharwad in Karnataka, worth Rs. 180 crore (US$ 22 million) and is expected to create about 18,000 jobs.
In FY23, India manufactured wearables such as earphones and smartwatches worth Rs. 8,000 crore (US$ 976.7 million), boosted by the implementation of a phased manufacturing plan (PMP). The industry is hopeful of doubling the production to Rs. 15,000-17,000 crore (US$ 1.83-2.07 billion).
As global companies are leveraging the well-developed manufacturing system in the State, Tamil Nadu has emerged as one of the major electronics hardware manufacturing and exporting States in the country. The state is well positioned to achieve a US$ 100 billion ESDM industry in the next five years.
In November 2023, Mr. Ashwini Vaishnaw, Union Minister of Communications & IT said that 99% of mobiles used in India are made in India.
Industrial robot accessories company Robot System Products (RSP) has announced plans to set up a subsidiary in India. The Indian entity Scandinavian Robot Systems India Private Limited has been registered in Chennai and will supply a range of industrial robot accessories to Indian customers.
The Indian startup ecosystem is experiencing a surge over the years, due to rapid technological advancements, increasing internet penetration, growing digital infrastructure, rising startup culture, government initiatives like Digital India, Make in India, and Startup India, as well as a large pool of skilled workforce.
India has witnessed an exceptional surge in the creation and funding of startups as the country has solidified its position as a major global centre for innovation and businesses. However, securing adequate funding remains a significant task for startups, often leading to survival challenges.
In 2023, the funding scenario for tech startups turned bleak amid the global uncertainty, witnessing a 67% YoY plunge in total funding to US$ 6.0 billion. This decline came after the peak funding levels observed in 2021 (US$ 24.1 billion) and 2022 (US$ 18.2 billion), where investors displayed confidence in Indian tech startups. In 2023, the number of deals declined to 824. However, the decline appears to be cyclical than a long-term trend.
The inaugural Future Skills Summit was organized by the Ministry of Electronics and Information Technology (MeitY) in collaboration with the National Institute of Electronics and IT (NIELIT) in Guwahati on February 15, 2024.
STPI Signs MoUs to Strengthen Tech Startup Ecosystem: AIC STPINEXT Initiatives (STPINEXT), a special purpose vehicle of Software Technology Parks of India (STPI), an organisation under the Ministry of Electronics and Information Technology (MeitY) has signed two memorandums of understanding (MoUs), one with HDFC Bank, and another with Excelpoint Systems India Pvt. Ltd., a niche technology player for fostering entrepreneurship and nurturing tech startups in the country. These partners would play a critical role in supporting and handholding the startups in the growth journey through technical guidance & assistance, mentoring, pitching to investors, funding support, and market connect & access etc.
India has made substantial cuts to import duties on mobile phones to enhance exports. In the last financial year, mobile phone exports reached Rs 1.2 lakh crore (US$ 14.4 billion), and this upward trend is expected to persist.
About 80% of the Production-Linked Incentive scheme (PLI) to encourage manufacturing in the country, which covers 14 industries and has a total investment of Rs. 3 lakh crore (US$ 38.99 billion) is concentrated in only three sectors: electronics, automobiles, and solar panel production.
Production Linked Incentive Scheme (PLI), one of the significant incentive schemes, is aimed at boosting domestic manufacturing of mobile phones and their components, including Assembly, Testing, Marking and Packaging (ATMP) units. As a part of this scheme, ~US$ 5.7 billion (Rs. 420 billion) will be extended as an incentive of 4-6% on incremental sales (of goods manufactured locally) for five years.
In March 2024, the Cabinet approved a massive US$ 15.2 billion (Rs. 1.26 trillion) investment in three semiconductor plants, signifying India's technological progress.
The Department of Empowerment of persons with disabilities (DEPwD) has signed a Memorandum of Understanding (MoU) with the Electronics sector skills council of India (ESSCI) to enhance the empowerment and skill development of Persons with disabilities (PwDs).
Under the PLI scheme for IT Hardware, the approved enterprises are estimated to manufacture equipment worth >US$ 21.62 billion over the next four years. Of the total production, foreign companies have suggested production worth US$ 11.38 billion, whereas domestic enterprises have planned a production of US$ 10.20 billion.
For skill development in the ESDM sector, we have organisations such as the Electronics Sector Skills Council of India, the National Institute of Electronics & Information Technology, Ajmer, India Electronics and Semiconductor Association.
The Electronics Sector Skills Council of India (ESSCI) aims to facilitate a world-class ecosystem for developing a future-ready workforce in the Electronics System Design & Manufacturing Sector. Its mission is to become a global leader in skill development in Electronics by aligning to the product lifecycle – Design, Manufacturing & Service through blended Skilling, R&D, Innovation & adoption of state-of-the-art technologies to reach the masses and lead to the growth of the ESDM sector.
The Government of India launched the 'Scheme for financial assistance to select states for skill development in the ESDM sector' in November 2013. The scheme was aimed at enhancing the skilling capacities in the ESDM Sector through the public and private sectors for students/unemployed youth belonging to other disciplines.
India Electronics and Semiconductor Association (IESA) aims to grow the ESDM & electronics business segment in India & make India the preferred destination for electronics & semiconductor design & manufacturing.
India Electronics and Semiconductor Association (IESA) acts as a trusted knowledge partner to the Central & State Governments helping device policies & incentives for the ESDM industry to help attract investments into India. In order to promote technology solutions to positively impact the lives of 1.3 billion Indian citizens is a key aim of IESA, which it achieves by bridging the gap between academia & industry to bring innovations faster to market.
To sustain the momentum of the Electronics System Design and Manufacturing (ESDM) sector, the government has positioned electronics production as a cornerstone of flagship programmes such as Make in India, Digital India and Start-up India. The sector is central to the vision of generating US$ 1 trillion in economic value from the digital economy by 2025. Rising internet penetration, along with India’s position as the world’s second-largest smartphone manufacturer, will further accelerate demand for electronic products and strengthen the domestic manufacturing base. With the industry projected to reach US$ 520 billion by 2025 and nearly double its contribution to GDP in the coming years, the ESDM sector is set to play a defining role in India’s digital and economic transformation.
