MacroScan - The Electronics Industry PLI Scheme: A missed opportunity?

India's recent policy push to promote domestic electronics manufacturing is yet again pivoted on a belief in the ability of large foreign firms to support the development of an advanced parts and components ecosystem. The output-based incentivisation scheme fails to factor in the continuing import dependence by foreign invested and domestically owned electronics companies and their lack of R&D in India. Without a drastic change in policymakers’ perception of the nature of state interventions required to overcome the industry’s structural weaknesses, the current small window of opportunity to shift India away from being a digital colony will close in front of us.

** The authors are Consultant, Institute for Studies in Industrial Development (ISID) and Professor, Centre for WTO Studies, respectively.

* This article was originally published in the Business Line on January 5, 2021.