Mumbai: The Union Budget 2026 has unveiled a series of measures aimed at strengthening India’s electronics manufacturing ecosystem, including a fresh push for semiconductor development and a major expansion of incentives for electronics components manufacturing. Industry body All India Electronics Association (AIEA) has welcomed the announcements, calling them a positive step towards building a resilient and self-reliant electronics value chain.
Among the key announcements is the launch of India Semiconductor Mission 2.0, with an outlay of ₹40,000 crore, building on the earlier semiconductor initiative. The Budget has also expanded the Electronics Components Manufacturing Scheme (ECMS) to ₹40,000 crore, a move expected to provide a significant boost to domestic manufacturing of electronic components. In addition, the government has reiterated its emphasis on Production-Linked Incentive (PLI) schemes to accelerate electronics and mobile phone manufacturing, alongside a renewed focus on industry-led research, innovation, and workforce development.
Welcoming the Budget, AIEA said the measures reflect the government’s continued commitment to strengthening India’s electronics manufacturing capabilities. However, the association stressed that the success of these schemes would depend heavily on how they are implemented on the ground.
“We sincerely hope that the implementation frameworks and compliance mechanisms under these schemes are made simpler, more transparent, and MSME-friendly, enabling small and medium enterprises to perform, sustain, and scale efficiently,” the association said.
AIEA also cautioned that policy focus should not be limited to headline investments such as semiconductor fabrication plants alone. It underlined that the electronics value chain is only as strong as its weakest link, and that Printed Circuit Boards (PCBs)—the backbone of all electronic products—depend on a wide array of low-value but mission-critical components.
“These include resistors, capacitors, connectors, relays, diodes, inductors, and other active and passive components. India’s electronics growth story will accelerate meaningfully only when component-level manufacturing is recognised as strategically critical infrastructure,” the association said.
According to AIEA, this recognition must be backed by dedicated incentives, simplified compliance regimes, and focused hand-holding support for MSMEs engaged in component manufacturing.
In this context, the expansion of the ECMS to ₹40,000 crore was described as a timely and potentially game-changing decision. The association said the enhanced scheme could play a crucial role in strengthening domestic value addition, reducing import dependence, and improving supply-chain resilience in the electronics hardware sector.
The statement was issued by Mitesh Mody, National General Secretary of the All India Electronics Association.
