India’s electronics ambition: Scaling manufacturing in the digital age

India’s consumer electronics sector is a vital pillar of the digital economy, transforming from an import-dependent market into a dynamic manufacturing hub. The industry’s contribution to GDP rose to 3.4% in FY2025, up from 3.2% a year earlier, reflecting both demand expansion and supply-side strengthening. India’s vast domestic market, supported by rising disposable incomes and rapid urbanisation, continues to create strong growth opportunities for consumer electronics.

At the macro level, India’s digital economy is poised to expand at twice the pace of the broader economy, significantly amplifying demand for electronic products. In line with this trajectory, the government targets USD 300 billion in electronics production by 2026. India has also become an increasingly attractive destination for global consumer electronics companies, supported by a liberal FDI regime that permits 100% foreign investment in electronics manufacturing and offers multiple entry routes for investors.

Despite this momentum, India currently accounts for only about 4% of the global electronics market and remains largely assembly-driven. The government’s longer-term ambition is to deepen local value addition and integrate more meaningfully into global value chains (GVCs). While mobile phones have spearheaded India’s emergence as a manufacturing base, the next frontier lies in scaling IT hardware manufacturing. The targeted policy framework is designed to catalyse a shift from pure assembly to high-value, vertically integrated manufacturing, signalling a decisive move toward capturing a larger share of the global electronics value chain.