Shrinking Margins Hurt 'Make In India' Electronics Sector

2025-07-03 02:07:55

(MENAFN- KNN India) New Delhi, Jul 3 (KNN) India's 'Make in India' electronics sector is facing a slowdown as profit margins continue to shrink, raising concerns for domestic manufacturers.

Key electronics companies say they are struggling to stay profitable as production costs rise and global competition tightens.

Industry players such as Dixon Technologies and Optiemus Electronics highlight that while production-linked incentives (PLIs) offered initial support, they are no longer enough to sustain profits, reported business standard.

Due to increased input costs, currency fluctuations, and competitive pricing by global giants like China and Vietnam, several Indian manufacturers are witnessing falling margins and stagnant growth.

Mobile phones, a major success story under the Make in India initiative, are now being manufactured in large volumes.

However, the profits from assembly are low since India still imports most of the components. Experts say that unless the country strengthens its component ecosystem, it will be difficult for local players to grow sustainably.

The government's push for domestic production helped India reduce electronics imports and boost exports. But with margins under pressure, manufacturers are warning that it may not be sustainable in the long term without deeper reforms.

These include reducing import dependence on components, improving logistics, and offering more targeted support for small and mid-sized manufacturers.

Many companies also say that while the PLI schemes helped scale operations, they did not address challenges in pricing, infrastructure, and local component sourcing.

Without a stronger foundation, India may struggle to compete globally in electronics manufacturing.

Industry leaders are now urging the government to revisit the policy framework and provide more comprehensive support to ensure the long-term success of the Make in India mission in electronics.

(KNN Bureau)

MENAFN03072025000155011030ID1109757877

Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.