On Wednesday, the government released a statement noting that a plethora of international telecom equipment makers are keen to come to India for manufacturing. Ericsson and Nokia are considering their options to come to India for manufacturing. While Samsung, Cisco, Ciena and Foxconn have “shown interest”. Notably, The government attributes that to the PLI Scheme in telecom infra it announced in February.
PLI Scheme to make India a Telecom Infra Hub
The official release said that many industry leaders are keen to expand or set up manufacturing in India. Furthermore, the release noted the “positive” reaction related to the kind of incentives proposed under the PLI scheme.
The release also highlighted the status of the enterprising scheme for telecom products. Notably, this scheme seeks to position India as a global hub of manufacturing telecom gear.
“Companies like Ericsson Sweden and Nokia Finland are keen to expand their existing operation in India for global supply chain. Global telecom companies like Samsung South Korea, Cisco USA, Ciena USA, and Engineering Manufacturing Services (EMS) companies like Jabil USA, Foxconn Taiwan, Sanmina USA and Flex USA have shown interest to set up manufacturing in India for telecom and networking products for domestic as well as export markets,” the release said.
Along with these global names, many Indian manufacturers have also shown a keen interest. Manufacturers such as VVDN Technologies, Dixon, HFCL, Coral Telecom and Sterlite have also shown interest in the scheme. The interest is so keen that Dixon has signed an MoU with Bharti Enterprises to form a Joint Venture on Wednesday. This JV will allow them to apply to the related authorities for the same.
Features of the PLI Scheme
The PLI scheme in telecom and networking products aims to make India a global hub of manufacturing telecom equipment. Primarily, this includes core transmission equipment, 4G/5G next generation RAN and wireless equipment. Along with this, it will focus on access and Customer Premises Equipment (CPE). Also, the scheme is applicable on IoT devices, other wireless equipment and enterprise equipment like switches and routers as well.
The government estimates that once the funds are fully utilized, the PLI scheme will generate incremental production. Estimates place production value at around Rs. 2.4 lakh crore and exports at around Rs 2 lakh crore, over five years. Along with this, the scheme will attract investment of around Rs 3,000 crore, while generating direct and indirect employment.
Under the PLI Scheme, the investor will receive incentive up to 20 times the committed investment. This incentive will enable many to reach global scales. Furthermore, the incentive will also allow them to utilize their unused capacity and upscale production. India currently imports telecom equipment worth Rs. 50,000 crores. In order to reduce the trade deficit, the government introduced this scheme. This scheme also resonates with the ‘Make in India’ sentiment in the country.
The PLI scheme aims to reshape India into a global manufacturing hub, which can rival China and make India a net exporter in terms of telecom and networking infrastructure. The government is also planning an extensive outreach program, partnering with the Invest India team.
The release listed out the details of the outreach program as well. This will cover one-to-one meeting with potential investors, participation in global outreach events organised by industry associations, microsite for the scheme on the Invest India website, separate interactive website for applications as well as selected vendors for the entire scheme interface, the release added.