New Delhi: India aims to produce up to 70% of its IT hardware needs domestically over the next three years, decreasing the reliance on imports from questionable sources. This announcement was made by Rajeev Chandrasekhar, Minister of State for Electronics and Information Technology.
During an announcement, he stated, ‘Currently, imports provide roughly 80% of the materials for the digital ecosystem. It is understood that the Indian portion of the supply chain will need to expand in order to emphasise trust. The goal is to increase that percentage to 65-70% over the next three years.’
Currently, 8-10% of the supply needed comes from India. As many as 40 companies, including Dell, HP, and Lenovo, have applied for the IT hardware Production Linked Incentive (PLI) scheme with a commitment to make personal computers, laptops, tablets, servers, and other equipment worth Rs. 4.65 lakh crore (US$ 56.07 billion) during the scheme period.
If all companies get selected under the scheme, then the government will need to increase the incentive amount to Rs. 22,890 crore (US$ 2.76 billion) against the budgetary allocation of Rs. 17,000 crore (US$ 2.05 billion).
While the PLI scheme introduced by the government has received praise from industry players, there is also a growing concern regarding the sudden restrictions on the import of IT hardware. Rajeev Chandrasekhar highlighted the importance of holding meetings with industry players to discuss the draft rules for the proposed restrictions on IT hardware imports.
The aim is to tackle the heavy reliance on imports from unverified and potentially untrustworthy sources. Propositions have been made to implement new regulations, starting from November 1, which would allow for restricted imports of laptops, tablets, servers, and other similar devices.
He further mentioned that in light of the internet’s expansion, it is essential for individuals to exclusively rely on servers and laptops from reputable manufacturers for our Indian cloud and data centers. It is apparent that the Indian aspect of that supply chain must expand to underscore the importance of trust.
Jason Oxman, US-based Information Technology Industry (ITI) President and Chief Executive Officer (CEO) said, ‘India is a leader in the field of technology policy and that, with the implementation of the Digital Personal Data Protection Act, it has accomplished a feat that only a select few other economies have managed. However, he mentioned that India must approach imports cautiously and understand that no one nation can produce everything domestically.’
He further mentioned that India hastily announced a new import restriction policy for tablets, laptops, and other electronic products, without engaging with relevant stakeholders. As a result, a new licensing framework for imports would now be required. If incorporated without significant modifications, such policies will excessively impede commerce and inflict harm on Indian consumers and companies, emphasizing the importance of granting the technology sector a position at the negotiating table.