India’s electronics manufacturing debate suffers from two unhelpful tribes. Government cheerleaders announce that every assembled phone proves technological self-reliance. Cynics dismiss all assembly as screwdriver work and imply nothing meaningful has changed. Both positions are lazy. Scale is real, valuable and difficult. It is also not the destination.
The production-linked incentive strategy helped make India a serious location for mobile-phone manufacturing and exports. Factories, supplier decisions and employment do not become imaginary because critics dislike industrial policy. But imported displays, camera modules, memory, machinery and intellectual property still account for substantial value. A phone’s country-of-origin label cannot tell us where its economic power resides.
Give the first phase its due
The government’s official description of the large-scale electronics PLI is unusually candid about India’s original disadvantages: infrastructure, logistics, finance, design capability, research and skills. The scheme offered incentives on incremental sales to attract investment and raise production. That was a sensible response to an ecosystem problem rather than a belief that markets materialise through patriotic speeches.
Manufacturing networks are sticky. Suppliers prefer locations with customers, trained workers, reliable logistics and other suppliers. India needed a forceful intervention to overcome the circular argument that components would not come without assemblers and assemblers would not come without components. Incentives helped create volume around which deeper capability can form.
The left’s reflexive objection that supporting corporations is inherently suspect ignores how every major manufacturing power shaped industrial capacity. The relevant questions are whether incentives buy measurable outcomes, whether competition remains open and whether temporary support produces lasting capability. Refusing to play while other countries construct supply chains is not purity; it is surrender.
The government’s own numbers show progress and distance
MeitY’s March 2026 achievements report lists cumulative production, investment and direct employment under IT-hardware and large-scale electronics schemes, alongside approved semiconductor facilities and design projects. These figures show industrial movement. They also reveal the different scales of activity: enormous production values can coexist with relatively modest investment or employment in particular programmes.
We should read the numbers as evidence, not incense. Production value is not domestic value added. Employment totals do not describe wage quality, gender conditions or skill progression. Approved semiconductor projects are not operating fabs. Disbursement is not capability. Every industrial-policy dashboard needs columns for what happens after approval.
The government deserves credit for publishing programme information. It should go further with plant-level or scheme-level aggregates on domestic procurement, exports, incentive paid, jobs sustained, training and technology transfer. Commercial confidentiality matters, but secrecy should not become a refuge for weak evaluation.
Why Chinese brands still dominate attention
Indian consumers did not choose Chinese smartphone brands because of ideological confusion. They chose them because these companies delivered large batteries, competitive cameras, fast charging, broad retail distribution and relentless model refreshes at prices Indian incomes could support. Any account that reduces their success to dumping or marketing avoids the uncomfortable lesson: they understood the market.
Some brands burden phones with unwanted software and confusing portfolios. Their update records vary. Yet their supply-chain integration and speed remain formidable. Indian brands once had distribution and local familiarity but often relied on imported designs without building durable product capability. When competitors improved quality and aspiration, nationalism could not compensate.
Make in India should not mean protecting weak Indian labels from strong products. It should mean making India the place where strong products are designed, engineered and manufactured, regardless of the founder’s passport—while creating room for domestic firms to acquire capability.
Components are where policy becomes harder
Final assembly benefits from scale and relatively clear incentives. Component ecosystems require specialised materials, precision, long qualification cycles, dependable utilities and technical depth. A supplier may need several anchor customers before investing. Those customers may demand global prices and failure rates from day one.
The state’s role should shift from paying mainly for output to reducing ecosystem costs. Industrial clusters need power quality, water, waste treatment, customs efficiency, testing laboratories and rapid logistics. Universities and technical institutes should work with manufacturers on actual process problems. Training must lead beyond repetitive assembly toward maintenance, tooling, quality and design.
Policy should distinguish strategically valuable components from fashionable announcements. Not every part needs to be domestic. Resilience comes from diversified, trusted supply and capability in critical layers, not autarky. India should pursue areas where market scale, engineering talent and geopolitical demand create plausible advantage.
Semiconductors require patience and honesty
Chip manufacturing is the summit everyone wants photographed beside. It is capital intensive, technically unforgiving and dependent on dense global networks. India is right to invest, but political timelines must not distort industrial reality. A project announcement, groundbreaking, equipment installation and qualified production are different milestones.
Assembly, testing and packaging are meaningful capabilities, not consolation prizes. Design is also an Indian strength worth expanding. The danger is narrating every facility as evidence that dependence has ended. Overclaiming creates public cynicism when schedules move, as complex projects often do.
Government should publish milestone progress and explain delays without treating them as national humiliation. Industrial learning includes failure. The countries we admire accumulated expertise through decades of patient coordination, not one triumphant subsidy round.
Design is the missing multiplier
India captures more value when engineers define products, architectures and intellectual property rather than merely execute external specifications. The country has deep software and chip-design talent, yet consumer-electronics brands with global reach remain limited. Policy must connect manufacturing scale with product creation.
Procurement can help early products gain reference customers, but it must not shelter mediocrity. Research grants, shared laboratories, patient capital and stronger university-industry links matter. So does bankruptcy that allows resources to move when ideas fail. Innovation policy cannot demand guaranteed success from every rupee; it should demand transparent learning.
Indian firms also need incentives to invest in service, updates and repair. A domestically designed device that frustrates its owners is not strategic capacity. Product quality is industrial policy experienced by a consumer.
The counterargument about subsidies
Critics reasonably ask whether public money is enriching companies that would have produced in India anyway. Incentive design must address additionality. Payments should follow verified incremental outcomes, and schemes should expire or evolve. Companies cannot treat support as permanent rent.
There is also a risk of states competing through land and concessions without calculating opportunity cost. Transparent contracts and post-project evaluation are essential. Pro-manufacturing does not require being credulous about every corporate projection.
Still, the alternative is not a subsidy-free global market. Competitors use tax policy, infrastructure, finance and strategic restrictions. India must participate intelligently, bargaining for depth rather than pretending neutrality will produce factories.
The next scorecard
I would measure the next phase through domestic value addition, component exports, research employment, patents with commercial use, supplier density, women’s workforce participation and the survival of production after incentives decline. I would also track how quickly Indian plants can introduce new models and processes. Capability is the ability to change, not merely repeat.
The government can legitimately celebrate what PLI helped build. Congress-era fatalism often treated manufacturing weakness as an inevitable consequence of global economics while celebrating services as sufficient. It was not sufficient. A large country needs a broader productive base, and the current government deserves credit for acting on that.
But the most loyal response to a successful first phase is to raise the standard. India has proved it can assemble at scale. Now it must make more of the parts, own more of the design and train more people to solve manufacturing problems. “Made in India” should gradually become a description of knowledge, not just location.
