Industry cheers PLI for telcos; says new scheme to spur jobs, production

The Rs 12,195 crore PLI scheme for telecom equipment manufacturing is "a big positive" that will spur local production, generate employment, and position the country as a global hub for innovation, industry experts said on Wednesday.

Industry body COAI lauded the move saying telecom is the backbone of a digitally-connected India and the initiative will further boost local manufacturing and create job opportunities.

"India is already the second largest telecom market globally and this will go a long way in making the country a global hub for telecom innovation," SP Kochhar, Director General of COAI (Cellular Operators' Association of India) said in a statement.

Earlier on Wednesday, the government unveiled a mega production-linked incentive (PLI) scheme for telecom gear manufacturing in India, which is expected to encourage production of equipment worth Rs 2.44 lakh crore and create direct and indirect employment for about 40,000 people.

The PLI scheme for telecom equipment manufacturing will be operational from April 1, 2021. It aims to make India a global hub of manufacturing of telecom equipment including core transmission equipment, 4G/5G next-generation radio access network and wireless equipment, access and Customer Premises Equipment (CPE), Internet of Things (IoT) access devices, other wireless equipment and enterprise equipment like switches and routers.

Prashant Singhal, Emerging Markets TMT Leader (Technology, Media and Entertainment and Telecommunications) at EY termed the latest incentive scheme for telecom and networking equipment as "yet another masterstroke" in the series of initiatives to enhance India's contribution to global value chain.

Labelling it as a "big positive" for invigorating ecosystem play for value addition, and boosting MSME market play in digital, Singhal said given the enabling environment, India is poised to attract global investments and propel towards a trillion dollar digital economy in the next two to three years.

The scheme is a fantastic move to advance the 'vocal for local' agenda, generate employment and embed local manufacturing in the fabric of India, he said.

The scheme is a significant boost for product manufacturing in the telecom sector, said Tony Verghese, Partner at J Sagar Associates.

"With the launch of 5G technology in the anvil, this will definitely prove to be an impetus for the 'Make in India' campaign of the Government and encourage local production including boosting more collaborations and technology transfers in the sector," Verghese said.