Indian electronics manufacturing services (EMS) firms are accelerating efforts to establish partnerships with global supply chain players, particularly Chinese companies, as the Indian government finalizes a ₹25,000 crore incentive scheme for electronic components manufacturing.

This initiative, aimed at boosting domestic production of key components such as display modules, camera sub-assemblies, printed circuit boards, and lithium cell enclosures, is expected to receive Cabinet approval soon.

Major players like Dixon Technologies, Micromax, Zetwerk, and Syrma SGS are actively pursuing joint ventures and strategic collaborations with Chinese suppliers embedded in global value chains (GVCs).

These partnerships are seen as critical to remaining competitive and bypassing lengthy qualification processes due to the established presence of Chinese firms in the global electronics ecosystem.

Micromax has already partnered with Taiwan’s Phison Electronics for storage modules and formed a joint venture with China’s Huaqin through its group company Bhagwati Electronics.

The company is developing a decade-long roadmap to strengthen India’s electronics component ecosystem. Similarly, Dixon Technologies has joined forces with China’s HKC to produce display modules by late 2025 and is exploring further collaborations for precision components and battery packs. Dixon is also planning a $3 billion display fabrication facility in India contingent on government subsidies.

Zetwerk is focusing on technology transfers and acquisitions to expand its electronics components business, while Syrma SGS Technology is evaluating potential partnerships aligned with export opportunities once the policy is announced.

Syrma SGS Technology, a Chennai-based EMS firm that recently won a contract from MSI to manufacture its laptops in India, is open to partnerships with global component players and is awaiting the policy's announcement.

The government’s easing stance on China-linked joint ventures reflects a pragmatic approach to integrating Indian firms into global supply chains while maintaining checks and balances.

An inter-ministerial committee chaired by the Home Ministry will evaluate each proposal on a case-by-case basis. This policy shift aims to enhance domestic value addition in electronics manufacturing from the current 18% to 35–40%, supporting India's broader goal of achieving $500 billion in electronics production by 2030.

MoneyControl Report