Budget 2026: Sitharaman allocates ₹40,000cr for electronics component manufacturing
What's the story
Finance Minister Nirmala Sitharaman has announced a major increase in the budget allocation for electronics manufacturing. The outlay under the Electronics Component Manufacturing Scheme (ECMS) will be raised to ₹40,000 crore for the fiscal year 2026-27. The move comes as part of India's efforts to bolster its position in global electronics manufacturing and reduce import dependency.
Scheme details
What is Electronics Component Manufacturing Scheme (ECMS)?
The ECMS, launched by the Ministry of Electronics and Information Technology (MeitY) on April 8, 2025, was initially allocated ₹22,919 crore over six years. The scheme aims to create a strong ecosystem for electronics components in India by providing incentives across 11 sectors such as printed circuit boards (PCBs), capacitors, resistors, display modules among others.
Strategic goals
Increased allocation to boost domestic manufacturing, reduce imports
The increased budget allocation is part of the government's strategy to leverage the momentum gained over the last year, promote higher domestic value addition, attract new investments, and integrate Indian manufacturers into Global Value Chains (GVCs). Industry executives believe this expanded outlay could help reduce India's reliance on imports of high-value components, strengthen supply-chain resilience and support its ambition to become a global electronics manufacturing hub.
Sector growth
Surge in electronics manufacturing
The announcement comes as India witnesses a major surge in electronics manufacturing, especially in the mobile segment. The production value of mobile phones has increased nearly 30 times from ₹18,000 crore in FY15 to ₹5.45 lakh crore in FY25. iPhone exports from India have also doubled to ₹2.03 lakh crore in 2025 compared to Apple's total exports of ₹1.1 lakh crore for the calendar year 2024.
Export targets
Semiconductor units approved in 6 states
India's mobile phone production is expected to touch around ₹6.76 lakh crore, including exports of over $30 billion (around ₹2.7 lakh crore) by the end of the current fiscal year. As of August 2025, 10 semiconductor manufacturing and packaging units have been approved with a total investment of about ₹1.6 lakh crore across six states.