The growth potential for the industry in the long run appears to be optimistic. The government has been providing regulatory support and incentivizing the R&D and production of several electronic components in the country. There is an increased focus on promoting the domestic research and manufacturing of electronics and increasing the export. This will directly lower the import bills and propel India\u2019s position as a global hub.

Recently, the Government of India approved the Production Linked Incentive (PLI) scheme to cover 10 key sectors for enhancing India\u2019s research and manufacturing capabilities. These sectors include electronic or technology products, ACC battery, automobile and auto components and telecom products among others. The PLI scheme is set to revolutionize the semiconductor industry in India which would also include the R&D and fabless design ecosystem.

Technology-driven System is the central pillar in the overall view of Atmanirbhar Bharat Abhiyan. Hence, providing necessary thrust to the R&D, design and manufacturing of semiconductors in the country is imperative. The global fabless chip design industry has grown globally with the biggest clusters being North America, Israel, Switzerland, France, Germany etc. However, this has been very limited in India. The PLI scheme will attract foreign companies to set up shops in India and also encourage local companies to set up or expand their existing capabilities. The sectors being covered in the PLI scheme have immense potential for semiconductors usage \u2013 like mobile phones, electronics, computers, batteries, etc. Companies would be able to claim benefits on incremental sales every year for the next five years.

The semiconductor consumption in India was about $21 billion in 2019, growing at the rate of 15.1 percent, according to IESA ESDM Market Report 2020. This shows the potential of India market to grow further. The PLI Scheme has provided the necessary impetus to the semiconductor industry and the government has followed it up with a notice inviting Expression of Interest (EoI) for setting up or expansion of existing semiconductor fab facilities in India. This move will also help in further bolstering the semiconductor R&D and design ecosystem. This comes at the right time as India is aiming to increase its share in the global manufacturing of mobile phones, IT hardware, IoT and other devices and aspiring to have USD 400 billion of electronics manufacturing by the year 2025. Even the vision of National Policy on Electronics 2019 (NPE 2019) has been to position India as a global hub for Electronics System Design and Manufacturing (ESDM) and create an enabling environment for the industry to compete globally. All these initiatives, in conjunction with PLI scheme, are helping the country put one foot in front of another in its journey of \u2018Make in India\u2019.

The PLI scheme will further help the existing semiconductor R&D scenario in the country. According to IESA, more than 90 percent of semiconductor companies in the world have their R&D centres in India. The semiconductor R&D produces around USD 2.5 billion in revenue and 6 lakh jobs in India. PLI scheme will attract more companies to set up their facilities in the country which will further boost the innovation sector including Fabless chip design.

It is clear that the government has a strong focus on making India a self-reliant nation and electronics\/technology products are a big piece of the entire picture. Semiconductors have been a key enabler in the advancement of electronics and have become a strategic sector now. The Government of India has been working tirelessly towards incentivizing and boosting the semiconductor industry in India including focus on building a thriving fabless design ecosystem. In the coming times, we are hopeful to see further reforms and initiatives from the government to provide full support to the electronics and semiconductor industry.","blog_img":"","posted_date":"2021-02-16 17:23:25","modified_date":"2021-02-16 17:27:39","featured":"0","status":"Y","seo_title":"PLI scheme: A propeller for ESDM industry","seo_url":"pli-scheme-much-needed-propeller-for-esdm-industry","url":"\/\/www.iser-br.com\/tele-talk\/pli-scheme-much-needed-propeller-for-esdm-industry\/4803","url_seo":"pli-scheme-much-needed-propeller-for-esdm-industry"}">