India is set to receive an investment of about ₹3,300 crore from 31 domestic and multinational companies over a period of four years under the ambitious production-linked incentive or PLI scheme that is expected to employ as many as 40,000 individuals in the telecom sector.
Following the incentive package unveiled early this year, proposals from as many as 31 companies that included 16 micro, small and medium enterprises (MSME), seven multinationals and eight domestic players have been approved by the telecom department (DoT).
The multinationals included Nokia Solutions and Networks, Foxconn Technology, Flextronics Technologies, Commscope and Jabil Circuit. In addition, HFCL, Tejas Networks, VVDN Technologies, Dixon Electro Appliances, and state-run ITI were among homegrown companies declared eligible under the scheme.
The scheme is expected to facilitate production of nearly 1.82 lakh crore units, and investment of about ₹3,345-crore was envisaged in the sector for over four years, creating an additional employment of more than 40,000 people, the DoT said in a note.
In April 2021, the Centre launched a program with an outlay of ₹12,195 crore to promote networking equipment by incentivising incremental investments by domestic and foreign companies.
The scheme, according to the note, would boost research and development (R&D) activities locally with companies committed to spend 15% of their revenues for the development of new products.
The support under the scheme would be provided for a five-year term from financial year 2021-22 to 2025-26.
The scheme for the telecom sector includes manufacturing of transmission equipment, next generation (4G and 5G) radio access network and wireless equipment, customer premise equipment (CPE), access devices, routers and switches.
The government is also aiming to create "global champions" out of India who could potentially grow and scale capabilities further to penetrate supply chains worldwide.
The ambitious program is aimed at providing impetus to the industry to move significant manufacturing capacities to India to boost the supply chain ecosystem, attracting more investment in the country.
In November 2020, the Cabinet approved the PLI scheme to boost local manufacturing across 10 sectors.