Electronics Component Manufacturing Scheme (ECMS) for Indian Manufacturers

On April 26, 2025, India introduced guidelines and an online portal for the Electronics Component Manufacturing Scheme (ECMS). Valued at INR 229.19 billion (US$2.7 billion), this initiative is designed to make India Atmanirbhar (self-reliant) in the electronics supply chain. The scheme focuses on building a strong component ecosystem by attracting significant global and domestic investments, enhancing manufacturing capacity and capabilities, and integrating Indian companies into Global Value Chains (GVCs).

Target Segment Categories under the Scheme include:

Sr No	Target segment
A	Sub-assemblies	Display module sub-assembly Camera module sub-assembly
B	Bare components	Non-SMD passive component Electro-mechanicals Multi-layer Printed Circuit Board (PCB) Li-ion Cells for digital application (excluding storage and mobility) Enclosures for mobile, IT Hardware products and related devices
C	Selected bare components	High Density Interconnect (HDI)/ Modified semi-additive process (MSAP)/ Flexible PCB SMD passive Components
D	Supply chain ecosystem and Capital equipment	Supply chain of sub-assemblies (A) & bare components (B) & (C) Capital goods used in electronics manufacturing including their sub-assemblies and components

Time Period

The ECMS will operate from FY 2025–26 to FY 2031–32, including a one-year gestation period. It aims to develop a complete supply chain for electronics manufacturing, boost domestic value addition, and position Indian companies as competitive players in global electronics markets.

Qualification Criteria

Applicants must meet the following requirements to be eligible under the ECMS:

• Both greenfield investments (new operations or facilities established from scratch) and brownfield investments (investments in existing production setups) in the target segment are eligible.
• Separate applications must be submitted for each product within the target segment.
• Multiple applications for the same product under a single target segment will not be accepted.
• Eligibility will be based on consolidated global Electronics System Design and Manufacturing (ESDM) revenue or manufacturing revenue, along with technological and financial capability, as specified in the scheme guidelines.

LIST OF PRODUCTS COVERED UNDER CERTAIN TARGET SEGMENTS

TARGET SEGMENTS	PRODUCTS COVERED
Non-SMD (surface mount device) passive components	Resistors, capacitors, ferrites, specialty ceramics, inductors, coils (including inductive coil), etc., for electronic applications
Electro-mechanicals	Speakers and microphones for ICT products, relays, switches, connectors, heat sinks, antenna, vibrator motors, oscillators, filters, actuators, crystals, sensors (non-semiconductors), transducers, etc., for electronic applications
Supply chain of sub-assemblies & bare components	Laminate, pre-peg, copper foil, separator, cathode material, anode material, electrolyte, polypropylene film, spray wire, lenses, protective film, glass cover, back light, contrast film, polarizer film, etc., for electronic applications

Qualification Criteria

Applicants must meet the following conditions:

Eligible Investments:

Greenfield investment: Establishing new operations such as factories or offices from scratch in India.

Brownfield investment: Investment in existing facilities or production arrangements in India.

Separate Applications:

One application per target segment product.

Multiple applications for the same product within a target segment are not allowed.

Evaluation Parameters:

Consolidated global Electronics System Design and Manufacturing (ESDM) revenue or manufacturing revenue.

Technological and financial capability as detailed in the scheme guidelines.

LIST OF PRODUCTS COVERED UNDER CERTAIN TARGET SEGMENTS

TARGET SEGMENTS	PRODUCTS COVERED
Non-SMD (surface-mount device) passive components	Resistors, capacitors, ferrites, specialty ceramics, inductors, coils (including inductive coil), etc., for electronic applications
Electro-mechanicals	Speakers and microphones for ICT products, relays, switches, connectors, heat sinks, antenna, vibrator motors, oscillators, filters, actuators, crystals, sensors (non-semiconductors), transducers, etc., for electronic applications
Supply chain of sub-assemblies & bare components	Laminate, pre-peg, copper foil, separator, cathode material, anode material, electrolyte, polypropylene film, spray wire, lenses, protective film, glass cover, back light, contrast film, polarizer film, etc., for electronic applications

 

India launched the Electronics Component Manufacturing Scheme (ECMS), with applications opening on May 1, 2025. The incentive distribution will be carried out by the central government on a “first-come, first-served” model. The time limit of application window are as follows:

1. For sub-assemblies and Bare Components: The application window opens from May 1, 2025, for a period of three months.
2. For Selected Bare Components and Supply Chain Ecosystem & Capital Equipment: The application window opens from May 1, 2025, for a period of 2 years.

 

Types of Incentives Offered Under ECMS

1. Turnover-linked Incentive

Based on percentage growth in sales (turnover) over a company’s base year.

Applicable only to eligible products manufactured in India.

• Eligibility Requirements:
  • Minimum level of increased sales.
  • Minimum level of cumulative investment.
• Employment Condition:
  • 1% of the incentive rate is linked to job creation.
  • If unmet, incentive reduces by 1%.

2. Capex Incentive

• Supports spending on eligible capital equipment and infrastructure for manufacturing specified products in India.
• Eligibility Requirements:
  • Minimum investment threshold.
  • Commencement of commercial production.
• Employment Condition:
  • Of the 25% capex incentive, 5% is tied to job creation.
  • If unmet, incentive reduces by 5%.

3. Hybrid Incentive

• A custom blend of turnover-linked and capex incentives.
• Designed for high-priority products identified under the scheme.

INCENTIVE RATES

Sr No	Target Segments	Cumulative Investments	Turnover Linked Incentive (%) over 6 years	Capex Incentive (%)
A	Sub-Assemblies
	Display module sub-assembly	2.5 billion (US$29.47 million)	4/4/3/2/2/1	NA
	Camera module sub-assembly		5/4/4/3/2/2
B	Bare Components
	Non-SMD passive components	500 million (US$5.89 million)	8/7/7/6/5/4
	Electro-mechanicals
	Multi-layer PCB		≤ 6 layers 6/6/5/5/4/4 ≥ 8 layers 10/8/7/6/5/5
	Li-ion Cells for digital application (excluding storage and mobility)	5 billion (US$58.95 million)	6/6/5/5/4/4
	Enclosures for mobile, IT Hardware products and related devices		7/6/5/4/4/3
C	Selected bare components
	HDI/MSAP/flexible PCB	10 billion (US$117.91 million)	8/7/7/6/5/4	25%
	SMD passive components	2.5 billion (US$29.47 million)	5/5/4/4/3/3
D	Supply chain ecosystem and capital equipment
	Supply chain of sub-assemblies (A) & bare components (B) & (C)	100 million (US$1.17 million)	NA	25%
	Capital goods used in electronics manufacturing including their sub-assemblies and components

Outcomes

The ECMS aims to attract investments worth INR 593.5 billion (US$6.99 billion), generate production output of INR 4.56 trillion (US$53.77 billion), and create 91,600 direct jobs along with substantial indirect employment opportunities across the electronics value chain.
So far, investment proposals worth ₹16,000 crore have been attracted under the scheme, according to sources.

Conclusion

The ECMS scheme is designed to strengthen the electronics supply chain by targeting key components and offering fiscal incentives. It helps reduce import dependency, increase domestic value addition, encourage investments and innovation, and create employment. Its simplified guidelines aim to improve ease of doing business with straightforward compliance and efficient execution.

SOURCES:

1. Press Release:Press Information Bureau
2. Electronics Component Manufacturing Scheme| National Portal of India
3. Govt gets investment proposal worth ₹16,000 cr under electronic component scheme, ETManufacturing