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Electronics Component Manufacturing Scheme (ECMS)

04 Jan 2026 GS 2 Govt schemes & initiatives
Electronics Component Manufacturing Scheme (ECMS) Click to view full image

Context

  • The Ministry of Electronics and Information Technology (MeitY) has approved 22 additional projects under the Electronics Component Manufacturing Scheme (ECMS).

  • Total scheme outlay: ₹22,919 crore.

  • Approved investment (latest tranche): ₹41,863 crore.

Objectives of ECMS

  • Strengthen domestic manufacturing of electronic components.

  • Reduce import dependence, especially on East Asian supply chains.

  • Promote employment generation and value addition in India.

  • Complement India’s electronics manufacturing ecosystem alongside PLI schemes.

Incentive Structure

  • Incentives are linked to:

    • Incremental production

    • Employment generation

  • Performance-based payouts, not upfront subsidies.

  • Incentives will be given to firms that achieve production milestones fastest → “first-to-finish” approach.

Beneficiary

  • Covers:

    • Small and medium Indian firms

    • Large established players, including Tata Electronics Pvt. Ltd.

  • Indicates an inclusive industrial policy rather than one focused only on large conglomerates.

Electronics Component Manufacturing Scheme (ECMS)

  • Notified on: 8 April 2025

  • Nodal ministry: Ministry of Electronics and Information Technology

  • Total outlay: ₹22,919 crore (≈ USD 2.7 billion)

  • Tenure: 6 years

  • Gestation period: Optional 1 year

Scope and coverage

  • Focuses on:

    • Electronic components

    • Sub-assemblies

    • Critical raw materials

  • Complements finished-goods manufacturing (e.g., mobiles) by deepening backward linkages.

  • Encourages large-scale, competitive manufacturing within India.

Electronics sector: India’s export and production transformation

Export performance

  • Electronics became India’s 3rd largest export category in 2024–25
    (7th in 2021–22)

  • H1 FY 2025–26 exports: USD 22.2 billion

  • On track to become 2nd largest exported item

                     

Production growth

       

  • Electronics production:

    • ₹1.9 lakh crore (2014–15)

    • ₹11.3 lakh crore (2024–25) → 6-fold increase

  • Exports:

    • ₹38,000 crore → ₹3.27 lakh crore → 8-fold increase

  • Jobs created (last decade): ~25 lakh


Prelims Practice MCQs

Q. Consider the following statements regarding the Electronics Component Manufacturing Scheme (ECMS):

  1. It provides incentives based on incremental production and employment.

  2. The incentives are given as upfront capital subsidies.

  3. The scheme encourages faster completion of production milestones.

Which of the statements given above are correct?

(a) 1 and 2 only
(b) 1 and 3 only
(c) 2 and 3 only
(d) 1, 2 and 3

Correct Answer: (b)

Explanation:

  • Statement 1 is correct – incentives are performance-linked.

  • Statement 2 is incorrect – payouts are not upfront subsidies.

  • Statement 3 is correct – incentives favour firms that reach targets early.

Q. With reference to India’s electronics manufacturing policies, consider the following:

  1. ECMS focuses primarily on finished electronic goods.

  2. ECMS aims to reduce India’s dependence on imported electronic components.

  3. The scheme includes both MSMEs and large firms.

Which of the statements given above are correct?

(a) 1 and 2 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Correct Answer: (b)

Explanation:

  • Statement 1 is incorrect – ECMS focuses on components, not finished goods.

  • Statement 2 is correct – import substitution is a core goal.

  • Statement 3 is correct – both small firms and large players are covered.



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