The Union Cabinet approved the Electronics Components Manufacturing Scheme with an outlay of ₹22,919 crore over six years, aimed at building a domestic components ecosystem and reducing India's heavy reliance on imported electronic components. The scheme targets sub-assemblies, bare components, and capital equipment manufacturing. It is administered by the Ministry of Electronics and Information Technology and is designed to complement existing PLI schemes by addressing the missing middle in India's electronics value chain.

India's electronics sector faces a structural vulnerability: while it assembles finished products like smartphones at scale, the components that go into them — capacitors, resistors, PCBs, display modules, camera modules, connectors — are overwhelmingly imported, primarily from China, Taiwan, South Korea, and Japan. This creates a deep current account pressure and supply chain fragility, as exposed during COVID-19 disruptions.

The Electronics Components Manufacturing Scheme (ECMS) is designed to solve this 'missing middle' problem. Unlike PLI schemes that incentivise finished-product output, ECMS targets the intermediate and capital goods layer — the building blocks of the electronics value chain.

The scheme's ₹22,919 crore outlay over six years uses a combination of financial incentives (production-linked and capex-linked) to attract both domestic and foreign manufacturers to set up component fabrication in India. It is implemented by MeitY (Ministry of Electronics and Information Technology).

For exam purposes, ECMS connects to three policy frameworks: (1) Atmanirbhar Bharat — import substitution in strategic sectors; (2) PLI scheme architecture — understanding how different electronics PLI schemes layer together; and (3) FDI and investment policy — the scheme is expected to attract significant foreign investment in deep-tech manufacturing.

RBI aspirants should note the foreign exchange dimension: India imports electronics components worth tens of billions of dollars annually, making this a priority sector for current account deficit management. NABARD aspirants should note potential rural electronics manufacturing clusters. SEBI aspirants should watch for listed companies in the components space that may benefit from scheme incentives.