TN launches electronics components manufacturing scheme

CHENNAI: The Tamil Nadu govt on Wednesday launched an incentive scheme in line with the Union govt’s programme to attract global and Indian electronics component manufacturing companies. The ‘Tamil Nadu Electronics Components Manufacturing Scheme’ will provide a matching grant to companies approved under Union govt’s incentive package and the govt expects it to bring in Rs30,000 crore investments and create 60,000 jobs.

After the scheme was launched by chief minister M K Stalin, industries minister T R B Raaja told the press, “The scheme will target to attract 11 broad categories of components, including display and camera modules, printed circuit boards (PCBs), flexi PCBs, high density interface boards, lithium-ion battery cells, SMD passive components. This scheme targets machinery used in component making and supply chain infrastructure, along with sub-assemblies and bare components.”

Tamil Nadu leads the country in electronics exports at $14.65 billion in 2024-25 and this initiative is expected to further boost the sector and help us reach the target of $100 billion, Rajaa said.

The Union ministry of electronics and information technology’s electronics component manufacturing scheme (ECMS) aims at promoting non-semiconductor components. Establishing a components ecosystem within the state will significantly boost the value chain and proactive state-level engagement is key to maximising the impact of ECMS, said Ashok Chandak, president of India Electronics and Semiconductor Association (IESA). The synergy of the various central and state schemes will create a globally competitive, sustainable advantage, he added.

Higher cost of logistics, finance and capex have hindered establishment of a domestic electronics component ecosystem with a NITI Aayog report estimating cost disability of up to 18% for components. The subsidies are expected to help manufacturers overcome disabilities and achieve economies of scale.