India Makes 99% of Its Phones—But Here’s the Catch No One’s Talking About
You know what’s wild? Walk into any mobile store here, and practically every phone on display—99% of ’em—were put together right here in India. But here’s the thing that keeps me up at night: open up those shiny new devices, and nearly 90% of what’s inside still comes from China, Korea, Taiwan. It’s like claiming you baked a cake when all you did was frost a store-bought one. The government’s new Electronics Component Manufacturing (ECM) scheme is trying to fix this. Will it work? Let’s be real—it’s complicated.
Assembly Lines vs. Real Manufacturing: There’s a Huge Difference
Here’s the reality check: Screwing together phones isn’t the same as making them. We’ve gotten crazy good at assembly—thanks to Foxconn and Samsung setting up shop—but when it comes to the actual guts? Semiconductors, displays, circuit boards? Yeah, we’re still playing catch-up.
- The numbers don’t lie:
- 90% of components? Imported. (Mostly from China, obviously)
- Our electronics imports make up nearly a third of the trade deficit
- Remember the 2020 chip shortage? That’s what happens when you don’t control your supply chain
Why This Component Thing Actually Matters
It’s not just about national pride—though that’s part of it. Let me break it down:
- Money talks: Every component we make here means money stays here—stronger rupee, more jobs, less dependency on China’s mood swings
- Safety net: Remember when China flexed its rare earth muscles? We can’t afford to be on the receiving end of that
- Eco-points: Shipping tiny capacitors halfway across the world? Not exactly carbon-neutral
The ECM Scheme: What’s Actually in It?
Launched last year, this is India’s latest attempt to grow its own component ecosystem. Think of it like a startup incubator, but for hardware:
- Show me the money: Subsidies for setting up factories (though no one’s saying exactly how much yet)
- Priority parts: They’re focusing on the big-ticket items—chips, displays, PCBs, the stuff that actually makes your phone smart
- Who can play? Both Indian companies and global players willing to manufacture here
But Here’s Why It Won’t Be Easy
Let’s not kid ourselves—this is hard:
- Tech gap: Building semiconductor fabs? We’re talking $10 billion per factory. That’s serious money
- Supply chain headaches: Even if we make PCBs, we’ll still need to import half the raw materials
- China factor: They control 60% of global component supply. Competing with that? Oof
Some Early Signs of Hope
But it’s not all doom and gloom:
- Tata’s big move: Teaming up with Taiwan’s Powerchip for a $3B semiconductor plant
- Battery hustle: Companies like Amara Raja are finally getting serious about lithium-ion cells
- PLI synergy: The ECM scheme builds on existing incentives—at least they’re not reinventing the wheel
So Can We Actually Pull This Off?
Short-term goal: Cut import dependence by 20-30% in five years. Ambitious? Absolutely. Impossible? Nah.
Long game: A proper component ecosystem—where we’re not just assembling, but actually innovating.
Dark horse: Indian startups. If we can nurture some niche players (imagine a homegrown TSMC), everything changes.
Final Take: Hopeful But Not Delusional
The ECM scheme? It’s a good start. But let’s be clear—this isn’t some quick fix. We’re talking massive investments, serious tech transfers, and patience measured in decades, not years. If it works though? India won’t just be assembling phones—we’ll be calling the shots.
Too long; didn’t read: We’re great at putting phones together, but the real value still comes from abroad. The ECM scheme is trying to change that. It’s gonna be a long ride—but at least we’re finally on the road.
Source: Livemint – Industry