India’s $4 Billion Design-Linked Incentive (DLI) Scheme

Vision and Objective

1. The government will launch a $4 billion scheme to boost electronics design in India.
2. The aim is to make India a global leader in designing and owning tech products.
3. It wants to reduce our heavy import of key electronic parts and become self-reliant.

Who Will Be Supported

4. The scheme will support:
   • Fabless chipmakers (who design chips but don’t manufacture),
   • Original Design Manufacturers (ODMs),
   • Original Equipment Manufacturers (OEMs).

What Products Are Covered

5. It will cover 30 semiconductor and 30 electronics product categories.
6. Products include modems, Wi-Fi chips, GPS chips, 5G parts, EV electronics, smart meters, home security, etc.

How the Incentives Work

7. Companies will get incentives based on capital investment and revenue.
8. The goal is to achieve up to 60% domestic value addition — most work should happen in India.
9. It supports companies that create and own designs and patents, not just assemble.

Strategic Importance

10. It helps reduce risk from global trade problems by strengthening local capability.
11. The Ministry of Electronics and IT (MeitY) is reviewing the plan; cabinet approval is expected soon.

Feedback on Previous Scheme

12. The 2021 DLI scheme gave only $12 million to 5 companies — too small and limited.
13. The new scheme is much broader and focuses on design, innovation, and IP.

Learning from Global Leaders

14. US tech giants like Apple, Intel, Nvidia, Qualcomm earn profits by owning patents.
15. India wants to build a similar ecosystem where we export designs, not just products.

Growth and Global Presence

16. This scheme helps Indian firms compete globally — not by copying, but by creating.
17. Future schemes may give Indian firms special access to Indian and global markets.

Link with Other Policies

18. It connects with PLI schemes, especially as mobile PLI benefits end next year.
19. Companies like Dixon Technologies and Syrma SGS may now focus on design and IP.

 Long-Term Vision

20. The final goal is to make India a leader in tech standards, innovation, and ownership — not just in assembling gadgets.

India’s Electronics & Telecom Imports – 2023-24 Overview

Total Import Value

1. India imported electronics, telecom, and electrical products worth USD 89.8 billion in 2023–2024.

Top Countries India Imported From

2. China alone supplied 43.9% of these products.
3. Hong Kong was also a major supplier.
4. Together, China and Hong Kong accounted for over half of the total imports in this sector.

Main Products India Imported

5. Communication devices – like smartphones, routers, and wireless gadgets.
6. Semiconductor devices – such as transistors, diodes, and ICs (integrated circuits).
7. Electric accumulators and batteries – used in phones, EVs, and more.
8. Electronic components – small but essential parts used in every electronic item.
9. Telecommunication instruments – used for mobile networks, internet, and data services.

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