As preparations gather pace for the upcoming Union Budget, industry body FICCI has urged the government to establish a Mega Electronics Industrial Park, while keeping self-reliance at the centre of such a move.
The idea is to co-locate Original Equipment Manufacturers, Electronics Manufacturing Services’ companies, and component suppliers to build scale, deepen the value chain, and enhance global competitiveness, driving case inspiration from Shenzhen and Bac Ninh (strategic industrial hub in northern Vietnam).
FICCI’s rationale
Such a move would promote inclusive growth by supporting MSMEs with shared infrastructure, test labs, and logistics, and ensure sustainability through green energy, water reuse, and safe worker housing, FICCI said.
While the electronics sector has taken substantial leaps over the last few years, aided by production-linked incentives and rising global interest in supply-chain diversification, FICCI said that domestic value addition remains constrained in non-mobile electronics, due to continued dependence on imported components such as Printed Circuit Board Assemblies (PCBAs).
Moving the needle
The needle has moved recently, as under the government’s Electronics Components Manufacturing Scheme (ECMS), where incentives widely range from printed circuit boards (PCBs), capacitors, connectors to aluminium extrusion, anode material and laminates.
However, FICCI has called for rationalisation of tariffs and HS Codes for PCB Assemblies, which it has identified as a critical bottleneck in the electronics value chain and in need for simplification. It said that under the government’s Steering Committee for Local Value Addition, Manufacturing and Exports (SCALE), PCB Assemblies have been prioritised with the target to significantly reduce imports by 2030.
For Budget 2026–27, it has recommended a unified HS Code structure for PCBA board assemblies and sub-assemblies within each major application segment, such as consumer electronics and IT hardware, to provide policy clarity and improve cost competitiveness.
The current HS Code structure for PCBAs is fragmented with differing tariff rates depending on application, which most often adds complexity and weakens the case for domestic manufacturing, as per industry insights.
While some corrective steps were taken under the Electronics Component Manufacturing Scheme notified in March 2025 and in the Union Budget 2025-26, FICCI believes further simplification is required.
Beyond electronics, FICCI has also flagged the need for easy access to critical minerals, seen as integral inputs for electronics, clean energy and advanced manufacturing. It has suggested targeted policy support for recovery of critical minerals from mine tailings and secondary sources, alongside financing mechanisms to scale up domestic processing capabilities.