India's federal cabinet has approved an INR 121.95 billion (approximately USD 1.68 billion) plan to promote local manufacturing and export of telecoms and networking equipment, Reuters reports, citing India’s telecoms minister Ravi Shankar Prasad. The plan will provide equipment manufacturers with annual cash incentives of between 4 percent and 7 percent on any increase in sales of locally-made equipment over the next five years, compared with 2019/20 levels.
The plan is part of Prime Minister Narendra Modi's efforts to make India an electronics production hub and to create jobs. The strategy also seeks to reduce imports, especially from China.
"I would appeal to all telecoms' equipment manufacturers, come on India is waiting for you with this scheme, we'll give you all the help", Prasad said.
Back in 2020, India launched a USD 6.65 billion incentive plan to boost smartphone manufacturing in the country.
Foxconn, Wistron and Pegatron, three of Apple's top contract manufacturers, plan to invest a combined USD 900 million in India over the next five years to tap into that plan, Reuters earlier reported.
According to Prasad, a top mobile maker will assemble USD 40 billion worth of devices in India over the next five years and export them to markets, including the US and Europe. "This large company has employed 20,000 people so far and will employ 100,000 directly and 300,000 indirectly by the next year", Prasad added, without giving the name of this company.
Amazon to open first device manufacturing line in India
In related news, Amazon today announced plans to start manufacturing Amazon Devices in India. Amit Agarwal, SVP and country head, Amazon India briefed Ravi Shankar Prasad, the country’s minister for communications on the details of this initiative. This is the first Amazon manufacturing line in India.
Amazon will start its manufacturing project in India with contract manufacturer Cloud Network Technology, a subsidiary of Foxconn in Chennai and launch production later this year. Amazon also reports that the device manufacturing programme will be able to produce hundreds of thousands of Fire TV Stick devices every year, serving customers in India. Amazon plans to continuously evaluate scaling capacity to additional marketplaces/cities depending on the domestic demand.
