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India approves $1.68bn local production strategy

Ravi_Shankar_Prasad cropped.jpg

India’s federal cabinet has approved plans to promote local manufacturing and export of telecoms and networking gear, in a strategy valued at US$1.68 billion.

Approved Wednesday, the country’s telecoms minister, Ravi Shankar Prasad (pictured), floated the idea of a manufacturing hub at the end of last year, as speculation mounted over when the country could see an official 5G launch in 2020.

Its operators maintain they will launch services this year using DSS to overcome the lack of C band spectrum and backhaul.

Following this, last year India launched a $6.65 billion incentive plan to deepen smartphone manufacturing in the country and since then Foxconn, Wistron and Pegatron – three of Apple Inc’s top contract manufacturers – have confirmed investments totalling almost $900 million in the country over five years.

Now the details are confirmed, the scheme will offer gearmakers annual cash incentives of between 4% and 7% on any increase in sales of locally-made equipment over the next five years, compared with 2019-20 levels.

In addition to creating an electronics production hub in India – and creating jobs – it is widely reported that the country is looking to reduce imports, especially from China.

In the press conference, Prasad shared details of an unnamed company, saying a top mobile maker will assemble $40 billion worth of devices in India over five years and export them to markets, including the United States 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,” he added.

Reuters also quoted him as saying at the event: “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."

Capacity will have more on this story in the next issue.

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