The Budget 2025 has introduced a series of strategic measures aimed at significantly boosting India’s electronics manufacturing sector.
Key impactful steps
• Smartphones and televisions may become more affordable with reduction in basic customs duty (BCD) on key electronic components.
• For manufacturers, this means lower input costs, making it more profitable to assemble phones in India.
• Reduction in Basic Customs Duty (BCD) on essential components such as display panels and lithium-ion batteries.
• Another key initiative is the substantial allocation of ₹9,000 crore to the Production-Linked Incentive (PLI) scheme for electronics manufacturing size to $200 billion within the next 3-4 years.
Mobility Magazine has spoken to the industry veterans, eminentre search analysts who shared their insights on the opportunities for India at the global level and on the measures to create a favourable ecosystem for the electronics industry, driving growth, creating jobs, and positioning India as a global manufacturing hub.
Mr. Prachir Singh, Senior Analyst, Counterpoint, declares, “The budget allocation for the Ministry of Electronics and Information Technology (MeitY) has risen by 48%, totalling ₹26,026 crore. To boost the semiconductor and display manufacturing ecosystem in India, budget allocation has been increased to ₹7,000 crore. Specifically, funding for semiconductor fabrication units has been more than doubled from ₹1,200 crore to approximately ₹2,500 crore. Funding for ATMP and OSAT units has been increased by 56% to ₹3,900 crore. In addition, the allocation for the modernization of the Semiconductor Laboratory in Mohali has been increased to ₹400 crore. The budget has eliminated the basic customs duty (BCD) on several critical components for mobile phones, including printed circuit board assembly (PCBA), camera modules, connectors, USB cables, fingerprint sensors, etc. This reduction from an earlier 2.5% to zero is expected to lower input costs, which will boost consumer demand as well as India’s competitiveness in global manufacturing which will have a positive effect on exports from India. Also, the BCD on components used to manufacture Open Cells has been reduced to zero from 2.5% that will help to increase display module manufacturing in India. The government has also reduced duties on components in multiple electronics manufacturing segments, which will further expand the local manufacturing ecosystem.”
Mr. Amit Khatri, Co-Founder, Noise, says, “The Union Budget 2025, presented by Finance Minister Nirmala Sitharaman, sets a bold roadmap for India’s manufacturing growth with its visionary push for ‘Make in India’ and skill development. It is encouraging to see the government taking strategic steps to support the consumer electronics industry, particularly through the reduction in import duties on key components. This will lower production costs, boost local manufacturing, and enhance affordability, marking a significant step towards strengthening India’s position as a global hub for innovation.Additionally, the launch of the National Manufacturing Mission will empower domestic industries—small, medium, and large—to innovate and integrate into global supply chains, stimulating domestic consumption and creating a ripple effect across industries. As a homegrown brand that has consistently pushed in support of the ‘Make in India’ initiative, we are excited that this move will further bring industries together and help scale India’s manufacturing ecosystem to new heights. The establish-ment of five National Centers of Excellence for Skilling is another crucial step in bridging the talent gap, ensuring a future-ready workforce for advanced manufacturing. Further, the creation of a new ‘Fund of Funds’ for Startups with a ₹10,000 crore infusion will provide much-needed capital to fuel innovation and entrepreneurship mindset in the startup ecosystem, empower budding entrepreneurs in driving growth.”
Mr. Rajesh Sethi, Group Chief Financial Officer, Lava International Limited, comments, “The Union Budget presented by the Honourable Finance Minister today reiterates the government of India’s focus on inclusive growth and development. The measures under the manufacturing mission mark a decisive step forward in strengthening the nation’s infrastructural capabilities. With its strategic focus on domestic value addition, enhanced consumer spending power, and rationalized import duties, the budget aligns seamlessly with the vision of a self-reliant India. Particularly in the electronics and smartphone segment, exemption of customs duties on critical components, including lithium-ion battery scrap, cobalt powder, and other essential minerals will be a significant boost for the industry. This enhancement in consumer spending capacity, coupled with strengthened domestic manufacturing capabilities, creates a powerful synergy that will accelerate the success of the Make in India initiative.”
Mr. Arijeet Talapatra, CEO itel and TECNO, declares, “The Union Budget 2025 signals a strategic move to position India as a global hub for mobile manufacturing. The proposed tariff reductions on essential assembly components—such as PCBAs, camera modules, USB cables, and display modules—are a welcome measure that will improve cost efficiencies, accelerate localization, and strengthen the Make in India initiative. This move strengthens India’s position in the global supply chain, especially amidst shifting trade dynamics amongst major economies. The decision to raise the income tax exemption limit upto ₹12 lakh will substantially increase disposable income, providing a significant financial boost to taxpayers, leading to increased consumer spending on electronics. As purchasing power of consumers rises, the demand for smartphones and other digital devices is expected to rise, further fuelling the growth of India’s electronics industry. The establishment of five National Centres of Excellence for Skills and global skilling cooperation would equip young people for global opportunities. The Make in India campaign and streamlined trade policies are consistent with the government’s goals of driving growth, promoting investment, and encouraging women workforce participation.”
“The Union Budget 2025-26 presents encouraging prospects for the technology and digital infrastructure sector. We applaud the Indian Government for reinforcing India’s vision for self-reliance and innovation-driven growth in electronics manufacturing. Reducing BCD to 5% on open cell components and including 28 additional capital goods for mobile battery fabrication will strengthen local manufacturing and further generate employment in the sector. The formation of the National Manufacturing Mission and investment in skilling initiatives will contribute to India’s global competitiveness and facilitate the commitment to climate-friendly development. These measures, coupled with tax reforms and incentives, create a strong foundation for sustainable growth in India’s electronics ecosystem,” comments Mr. Ravi Kunwar, VP and CEO, HMD India and APAC
“We applaud the Honourable Finance Minister for initiatives like the Ministry of Skill Development and Entrepreneurship’s support for female micro-entrepreneurs through incubation and acceleration programs. These efforts are crucial for empowering women-led enterprises and fostering a more diverse, inclusive business landscape, ultimately contributing to India’s long-term manufacturing growth. However, we are concerned about the recent reduction in customs duties on open cells and components, which only benefits industries with bonded manufacturing plants, creating an uneven playing field and disadvantageous to other TV manufacturers. We believe these benefits should be extended more broadly across the sector to ensure true and sustainable growth. Additionally, the reduction in income tax up to Rs 12 lakh and the formation of a high-level committee for regulatory reforms are vital steps towards improving spending power and helping the common man fight rising inflation,” mentions Ms. Pallavi Singh, Country Representative, JVC TV India
Mr. Rajesh Doshi, Co-Founder & Director, Zebronics, says, “The Union Budget 2025’s introduction of the National Manufacturing Mission will bolster the ‘Make in India’ initiative significantly along with the reforms for MSMEs and start-ups which will greatly encourage employment opportunities including women workforce, across all spectrums. Additionally, the revised New Income Tax regime, with no tax on income up to ₹12 lakh, underscores an increase in disposable income, stimulating consumer spending and economic growth.”
“The Budget 2025’s tech-forward policies signal India’s ambition to dominate the global electronics value chain. Eliminating BCD on open cell components for displays isn’t just a tariff tweak—it’s a strategic unlock. By making India a cost-competitive hub for advanced display manufacturing, we’re poised to cut reliance on imports for LCD/LED panels, which currently account for 80% of the $7 billion display market. This will catalyse local R&D in next-gen technologies like OLED and Micro LED, critical for smartphones, wearables, and smart TVs. Equally transformative is the lithium-ion battery push. Adding 28 capital goods for mobile batteries will fast-track domestic cell manufacturing, addressing a critical gap where India imports 90% of its lithium-ion needs. For the wearables and smartphone ecosystem, this means shorter supply chains, faster innovation cycles, and sustainable cost efficiencies. India’s future will be driven by innovation, self-reliance, and a bold vision to lead the global tech revolution,” observes Mr. CP Khandelwal, CEO, PR Innovation, Brand Custodian of Amazfit India
Mr. Ashok Rajpal, Managing Director, Ambrane India, mentions, “The government’s reduction in import duties on key components in the electronics sector, coupled with the attractive PLI scheme for the hardware industry, will significantly strengthen production capabilities in India in the short run. Additionally, with the planned roadmap focusing on long-term growth, including substantial investments in semiconductor manufacturing and the launch of the National Manufacturing Mission, we are optimistic about the future of the manufacturing sector in India”.
“BUDGET 2025 definitely has opened new doors of manufacturing in India. The reduction in BCD may lead to increased grey market activities and under-invoicing, as manufacturers might exploit the lower duty structure These developments underscore the government’s commitment to fostering manufacturing growth across 14 priority sectors, such as mobile phones, pharmaceuticals, automobiles, and electronic products. The PLI scheme aims to attract investments, enhance efficiency, and position Indian companies as globally competitive players. We at ERD are overwhelmed with the BUDGET 2025 as we feel that the budget’s support for startups and MSMEs in the electronics sector will foster a culture of innovation and entrepreneurship,” says Mr. Sanjeev Bhardwaj, Founder & CMD, ERD Group
Mr. Paresh Vij, Founder, U&i & Lyne, voices, “The Union Budget 2025, presented by Finance Minister Nirmala Sitharaman, will definitely steer growth and sets a bold roadmap for India’s manufacturing growth with its visionary push for ‘Make in India’ and skill development. As we see that the government is taking strategic steps to support the consumer electronics industry, particularly through the reduction in import duties on key components and this will lower production costs, boost local manufacturing, and enhance affordability, marking a significant step towards strengthening India’s position as a global hub for innovation. We are extremely happy with the BUDGET 2025 as it also witnesses the launch of the National Manufacturing Mission will empower domestic industries—small, medium, and large—to innovate and integrate into global supply chains, stimulating domestic consumption and creating a ripple effect across industries. We are excited that this move will further bring industries together and help scale India’s manufacturing ecosystem to new heights.”
“The budget announcements by the Honourable Finance Minister saw key policy changes to boost manufacturing in India particularly in the electronic vehicles (EV) and television (TV) segment within the Electronics sector. Particularly, in the EV space, the full exemption on Basic Customs Duty (BCD) on cobalt powder, Li-ion battery waste and 12 other critical minerals, along with the exemption on lithium ion batteries will have its impact on related segments in the electronics accessories space. Brands like us which have a captive assembling unit and depend extensively on China for our battery imports could see cost benefits should such batteries (including those which are used in electronics accessories like power banks) are manufactured in India. While, encouraging domestic production is a positive, ensuring a a level playing field for all manufacturers will be key to achieving long term-growth. As India continues to strengthen its electronics ecosystem, the industry will be closely watching how these policy shifts shape the market dynamics in the coming months. Moreover, the Finance Minister mentioned about the help the Government will offer to MSMEs to achieve higher efficiencies of scale, technological upgradation and better access to capital. The investment and turnover limits for classification of all MSMEs enhanced to 2.5 and 2 times, respectively. Further, steps to enhance credit availability with guarantee cover have also been announced. This allows MSMEs/ New businesses to reposition their strategy for growth,” comments Mr. Sagar Gwallani, Founder and CEO, Urbn.
“The government has raised the income tax exemption limit from ₹7 lakh to ₹12 lakh, aiming to increase disposable income for the middle class. This move is expected to enhance consumer spending, thereby driving demand for electronic goods and creating a favourable environment for manufacturers. The budget proposes exemptions for components like open cells for LED/LCD TVs and capital goods for lithium-ion batteries used in mobile phones and EVs. These incentives are designed to reduce production costs and encourage domestic manufacturing in these high-demand sectors. A significant allocation of ₹20,000 crore has been earmarked to implement private sector-driven research, development, and innovation initiatives. This investment underscores the government’s commitment to fostering innovation within the manufacturing sector, encouraging companies to develop cutting-edge technologies domestically. These recent budgetary measures are steps in the right direction. However, to fully realize this potential, it is imperative to address infrastructure gaps, ensure policy consistency, and invest in skill development. At Nextech, we are optimistic that with these strategies, India can emerge as a global leader in electronics manufacturing,” speaks Mr. Milan R Agarwal, Founder & CEO, Nextech by Amson Interconnect Pvt Ltd
Mr. Vishal Shukla, Co-Founder, Tessco Mobiles, voices, “The Union Budget for 2025-26, set to be presented on February 1, is expected to focus more on funding state-run enterprises than pursuing privatization. The agriculture sector is anticipated to receive a 15% budget increase, totaling ₹2 Crore, aimed at supporting rural incomes and enhancing farm exports. Additionally, subsidies for essential items like food, fertilizers, and cooking gas are likely to rise by 8%. Introducing zero tariffs on PCBAs (Printed Circuit Board Assemblies), camera modules, and connectors could significantly reduce the cost of these essential components. This would likely lead to lower production costs, allowing us to offer more affordable products, thus improving profit margins and enabling us to pass on savings to customers. It could also foster local manufacturing by reducing reliance on imports, making domestic production more competitive. India is well-positioned to become a global manufacturing hub, given its large and skilled workforce, competitive labor costs, improving infrastructure, and supportive government policies like “Make in India”.
“The Union Budget’s National Manufacturing Mission is a pivotal step in strengthening ‘Make in India’ through policy support and clean tech innovation. With a strong focus on domestic manufacturing of solar PV cells, EV batteries, and high-voltage equipment, India is set to lead in sustainable technology. Addressing the inverted duty structure, the increase in customs duty on interactive flat panel displays will boost local production and investment in advanced display technologies. Additionally, the establishment of five National Centers of Excellence for Skilling and a ₹500 crore AI Centre of Excellence in education will bridge the industry-academia gap, fostering a future-ready workforce. These initiatives reinforce India’s path to becoming a global leader in advanced manufacturing and digital innovation. We welcome these efforts and look forward to collaborating with stakeholders to drive technological self-reliance and growth,” states Mr. Ujjwal Sarin, Founder, Nu Republic
Mr. Nagaraju Soma, Founder & Managing Director, CELLBAY, opines, “The Indian Budget 2025 represents a strategic blueprint designed to balance fiscal discipline with ambitious investments in infrastructure, renewable energy, social welfare, and digital transformation. Key Focus areas are GDP Growth Targeting target of 7.2% for the fiscal year 2025 and aiming to maintain the fiscal deficit is targeted at 4.5% of GDP. Removing tariffs on PCBAs, camera modules, and connectors can have several significant implications for the electronics manufacturing ecosystem in India which includes Cost Reduction for Manufacturers, Boost to Supply Chain Efficiency, Enhanced Competitiveness in the Global Market, Support for the ‘Make in India’ Initiative, Increased Consumer Benefits. On the flip side, while the assembly and manufacturing sectors may benefit, local producers of PCBAs, camera modules, and connectors could face stiff competition from imported goods. Improving manufacturing in India requires a holistic strategy that addresses both supply-side challenges and demand-side opportunities.”
“The reduction in Basic Customs Duty (BCD) and robust support for local manufacturing outlined in Budget 2025 are pivotal moves aimed at enhancing India’s competitiveness in the global market. By lowering the BCD on key components such as display panels and lithium-ion batteries, the government is reducing the cost burden on domestic manufacturers. This shift is expected to bolster local value addition, making Indian-produced electronics more cost-effective and attractive to both domestic and international markets. By addressing these challenges, India can achieve a balanced and robust manufacturing ecosystem that thrives on innovation and competitiveness,” comments Mr. Kavya P Vij, CPM of U&i and Lyne
Mr. Akhilesh Chopra, Director, Bluei, comments, “As per the Union Budget 2025, the government has continued push for a Make in India initiative and manufacturing incentives presents significant opportunities for expanding local production, reducing dependency on imports, and boosting India’s self-reliance in tech products. The reduction enables the company to enhance production efficiency and pricing competitiveness, which can drive growth in both domestic and international markets. We feel that the budget also focuses on digital infrastructure, with increased investments in 5G connectivity which strengthens the potential for innovative mobile accessories that complement advanced networks and technologies. To build a robust workforce, there must be a greater focus on skill development, especially in advanced manufacturing techniques.’’
Mr. Aashish Kumbhat, Managing Director, Sunshine Telelink Group, (A House of Brands – URBAN, Inbase, Arrow, iPak), comments, “This Union Budget 2025 aims to promote economic resilience, fiscal discipline, and industrial growth through tax reforms, infrastructure development, and investment in key sectors. The proposed National Manufacturing Mission will assist the Make in India Initiative and build India into a global manufacturing powerhouse and in turn, will create a lot of job opportunities. The government should focus on Infrastructure and logistics Modernization, including developing industrial corridors, upgrading ports, and improving road and rail connectivity. It should also promote ease of doing business by simplifying the compliance & taxation system; also incentivising & supporting the manufacturers to encourage them. Government should adopt strategies to enhance the Supply Chain Resilience by encouraging local sourcing of raw materials and reducing import dependency and work to build technology R&D infrastructure to be future-ready; also increase public-private investment in advanced manufacturing, automation, and AI-driven production.”
Mr. Gulshan Kumar, Managing Director, SoRoo, observes, “The government should focus on developing local manufacturing of basic components like cables, chargers, and protective cases by setting up dedicated manufacturing clusters for mobile accessories, providing tax incentives for local sourcing of raw materials, supporting R&D for innovative accessory development. The government should aim to stablish strict quality control measures specifically for mobile accessories build trust in “Made in India” accessories, compete effectively with imported products so that they meet international safety standards. To succeed, manufacturers should focus on high-quality, innovative products, invest in automation and quality control, build strong distribution networks, develop export capabilities and create strong after-sales service networks.”
“The Budget 2025 marks a pivotal moment in India’s economic landscape, especially for sectors like mobile accessories. For AMANI, a leading player in the mobile accessories market, the budget introduces opportunities and challenges that could redefine business strategies in the coming years. One of the most impactful provisions for AMANI is the reduction in import duties on electronic components, which will lower the overall cost of manufacturing mobile accessories. This reduction enables the company to enhance production efficiency and pricing competitiveness, which can drive growth in both domestic and international markets. Furthermore, the government’s continued push for a Make in India initiative and manufacturing incentives presents significant opportunities for expanding local production, reducing dependency on imports, and boosting India’s self-reliance in tech products. This strengthens the potential for innovative mobile accessories that complement advanced networks and technologies. India holds immense potential to become a global manufacturing hub due to its large labour force, improving infrastructure, and strategic location. Companies like AMANI are well-positioned to benefit from these developments, contributing to India’s rise as a key player in the global mobile accessories market,” comments Mr. Tarun Bhutani, Director, AMANI
Mr. Aarush Dhawan, Co-Founder, SERVIZ, says, “As a co-founder of SERVIZ, a dedicated after-sales service provider, I found the budget promising; however, greater emphasis on strengthening the consumer durables sector in FY 2025-26 would have been beneficial. Reducing taxes and offering subsidies on electronics and home appliances could not only boost consumer demand but also create a ripple effect across the entire ecosystem-spanning Tier 1 and Tier 2 cities while accelerating growth in emerging Tier 3 and Tier 4 markets. Such measures would drive employment generation, expand after-sales service opportunities, and contribute to overall economic growth. By implementing targeted incentives, the government can foster sustainable industry development, benefiting both businesses and consumers.”
Mr. Arjun Bajaj, Director, Videotex, comments, “The Union Budget 2025 marks a significant push toward supporting the electronics manufacturing sector, but some key areas could have been more impactful. The drop in Basic Customs Duty (BCD) from 2.5% to 0% on parts of the panel is a welcome move, though it should be noted that there is only one facility in India with limited capacity to process these parts. This change will primarily benefit that facility and those sourcing from it. The ongoing reliance on imported open cells, due to a lack of local manufacturing capacity, remains a critical challenge. A more substantial reduction in BCD—perhaps on more components—could have better supported the sector’s growth. Furthermore, the decision not to reduce GST on televisions in this budget is disappointing, as such a move could have been a game-changer in boosting TV sales. On a positive note, the enhanced income tax slabs provide a potential boost to the disposable income of middle-class families, which could help drive demand and offer a much-needed uplift to the sector”
TAKEAWAYS
Several measures aimed at boosting domestic electronics manufacturing and making imported gadgets more cost-effective. Indeed BUDGET 2025 signals a strategic move to position India as a global hub for mobile manufacturing as the move strengthens India’s position in the global supply chain, especially amidst shifting trade dynamics amongst major economies.
Covered By: Mobility India / Cover Story
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