The Production Linked Incentive (PLI) Scheme for Telecom and Networking Products has marked a significant achievement, with telecom equipment manufacturing sales surpassing the Rs 50,000 crore milestone within just three years of its implementation. This remarkable growth is a testament to the success of government initiatives aimed at boosting local production and reducing import dependency.
Since the inception of the Telecom PLI scheme, an investment of Rs 3,400 crore has been attracted, leading to substantial production and export figures. Telecom equipment production has exceeded Rs 50,000 crore, with exports amounting to approximately Rs 10,500 crore. The initiative has also created more than 17,800 direct jobs, alongside numerous indirect employment opportunities.
This milestone highlights the robust growth and competitiveness of India’s telecom manufacturing industry, driven by the PLI scheme’s focus on enhancing domestic manufacturing capabilities. The scheme offers financial incentives to manufacturers based on their incremental sales of products manufactured in India, aiming to position India as a global hub for telecom equipment production.
The PLI Scheme for Large Scale Electronic Manufacturing has similarly transformed the mobile phone manufacturing sector. India, once a significant importer of mobile phones, has seen a dramatic shift. In 2014-15, only 5.8 crore units were produced domestically, while 21 crore units were imported. By 2023-24, production soared to 33 crore units, with imports plummeting to just 0.3 crore units and exports reaching nearly 5 crore units.
The value of mobile phone exports has skyrocketed from Rs 1,556 crore in 2014-15 and a modest Rs 1,367 crore in 2017-18, to an impressive Rs 1,28,982 crore in 2023-24. Concurrently, the import value of mobile phones has decreased significantly from Rs 48,609 crore in 2014-15 to Rs 7,665 crore in 2023-24.
India’s longstanding dependency on imported telecom gear has been effectively addressed through the Make-in-India initiative and the PLI scheme. The production of telecom equipment valued at over Rs 50,000 crore within the country marks a pivotal shift, underscoring the nation’s advancing manufacturing capabilities and export potential.
Key Highlights Telecom (excluding mobile):
- Industry Growth: The telecom equipment manufacturing sector has demonstrated exceptional growth, with total sales exceeding Rs 50,000 crores by PLI companies. Sales of Telecom & Networking Products by PLI beneficiary companies in FY 2023-24 has increased by 370% vis-a-vis Base Year (FY 2019-20).
- Job Creation: The initiative has not only contributed to economic growth but also generated substantial employment opportunities across the value chain, from manufacturing to research and development, creating 17,800+ direct jobs and many more indirect jobs.
- Reduced Import Dependency: By encouraging local production, the PLI scheme has significantly reduced the country’s reliance on imported telecom equipment, resulting in import substitution of 60% and India has become almost self–reliant in Antennae, GPON (Gigabit Passive Optical Network) & CPE (Customer Premises Equipment). Reducing import dependency has thereby enhanced national security and fostered self-reliance.
- Global Competitiveness: Indian manufacturers are increasingly competing on a global scale, offering high-quality products at competitive prices.
Telecom equipment includes intricate items like radios, routers, and network equipment, among others. Furthermore, companies are permitted by the government to avail benefits for producing 5G equipments. 5G Telecom equipment manufactured in India is currently being exported to North America and Europe.
As a result of the PLI Scheme for Telecom and Networking Products and other related initiatives run by both DoT & MeitY, the gap between telecom imports and exports has reduced significantly with the total value of goods (both telecom equipment and mobiles put together) exported is over Rs 1.49 lakh crore as against imports of over Rs 1.53 lakh crore in FY 23-24.
In fact, over the last five years, the trade deficit in telecom (both telecom equipment and mobiles put together) has reduced from Rs 68,000 crore to Rs 4,000 crore and both the PLI Schemes have started to make Indian manufacturers globally competitive, attract investment in the areas of core competency and cutting-edge technology; ensure efficiencies; create economies of scale; enhance exports and make India an integral part of the global value chain. It has transformed India’s exports basket from traditional commodities to high value-added products.
