Tech Giants Set to Thrive: HP, Dell, Lenovo, and 24 Other Firms Approved for Tech Hardware Manufacturing in India under Incentive Scheme

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Tech / Monday, 27 November 2023 12:16

"Tech Manufacturing Boost: Dell, HP, and Lenovo Among 27 Companies Approved for IT Hardware Production in India

In a significant move to bolster domestic manufacturing and attract substantial investments, U.S. tech giants Dell and HP, along with China's Lenovo, are among the 27 companies granted approval to manufacture IT hardware in India. This approval comes under the government's Production-Linked Incentive (PLI) Scheme 2.0 for IT hardware, introduced in May to provide incentives for goods produced within the country.

The Ministry of Electronics and IT announced that well-known brands, including Acer, Asus, Dell, HP, and Lenovo, will commence manufacturing in India. The PLI Scheme, with a budget of 170 billion Indian rupees (approximately $2 billion) spanning six years, covers the production of laptops, tablets, all-in-one personal computers, micro PCs, and servers.

Out of the 27 approved applicants, 23 are ready to begin manufacturing immediately, according to Minister of Railways, Communications, and Electronics and IT Ashwini Vaishnaw. The companies are projected to collectively invest $360 million, generating around 200,000 jobs, comprising 50,000 direct employment opportunities and 150,000 indirect employment opportunities.

Addressing the challenges faced by the IT hardware manufacturing sector, the ministry highlighted the lack of a level playing field compared to other major manufacturing economies. The PLI Scheme 2.0 aims to compensate for these disparities and encourage the localization of components and sub-assemblies, fostering the development of a robust supply chain within the country.

With the Indian IT hardware market expected to grow to $22.77 billion in 2027 from $15.52 billion in 2022, the scheme is anticipated to broaden and deepen the manufacturing ecosystem. By providing incentives and a longer duration to develop the supply chain locally, the government aims to position India as a competitive player in the global tech manufacturing landscape.

This move aligns with the trend of major IT hardware manufacturers, including Apple supplier Foxconn and Samsung, diversifying their manufacturing bases beyond China. India, being the world's second-largest smartphone market, coupled with incentives for electronics production, has emerged as an attractive destination for expanding tech manufacturing operations."

"As India forges ahead with its ambitious Production-Linked Incentive (PLI) Scheme 2.0 for IT hardware, the inclusion of industry giants such as Dell, HP, and Lenovo signals a pivotal moment in the nation's quest to become a global technology manufacturing hub. The approval of 27 companies to produce IT hardware domestically underscores a strategic move to boost economic growth, create job opportunities, and strengthen the manufacturing ecosystem.

With a budget of $2 billion over six years, the scheme not only aims to address existing challenges faced by the IT hardware sector but also positions India competitively in the global landscape. The commitment of major players to invest $360 million collectively is set to fuel innovation and contribute significantly to the country's employment landscape.

As the Indian IT hardware market gears up for substantial growth, the PLI Scheme 2.0 is anticipated to play a pivotal role in fostering local production, encouraging the localization of components, and ultimately creating a self-sustaining supply chain. India's emergence as an attractive destination for tech manufacturing aligns with the broader trend of industry leaders diversifying their manufacturing bases, further solidifying the nation's position as a key player in the evolving global tech landscape."