Budget 2026: Finance Minister proposes Rs 40,000-crore Electronics PLI

During her Budget 2026 presentation, Finance Minister Nirmala Sitharaman proposed a Rs 40,000-crore outlay for electronics manufacturing under production-linked incentives (PLI) in FY 2026-27. She said the government will also set up high-tech tool rooms at two locations to boost capital goods manufacturing, part of a broader push to strengthen India’s electronics ecosystem.

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Electronics manufacturing has emerged as a standout performer under the PLI scheme, particularly mobile phones, with production rising 146% from Rs 2.13 lakh crore in FY21 to Rs 5.45 lakh crore in FY25, according to CareEdge Ratings. The growth was supported by $4 billion in FDI inflows, 70% of which went to PLI beneficiaries.


While the total PLI outlay across 14 sectors stands at Rs 1.97 lakh crore, cumulative disbursements have been relatively modest at Rs 23,946 crore as of September 2025. Incentives disbursed grew steadily over the past three years: Rs 2,968 crore in FY23, Rs 6,753 crore in FY24, and Rs 10,112 crore in FY25, with Rs 4,113 crore released in H1 FY26, suggesting a strong pipeline for the year.

Actual cumulative investments under the scheme have reached about Rs 2 lakh crore, generating incremental production of over Rs 18.7 lakh crore as of September 2025.

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Among sectors receiving the highest allocations, large-scale electronics manufacturing tops the list with Rs 38,645 crore, followed by automobiles and auto components (Rs 25,938 crore), solar PV modules (Rs 24,000 crore), advanced chemistry cell batteries (Rs 18,100 crore), and IT hardware (Rs 17,000 crore).

Also Read: Union Budget 2026: Sitharaman unveils India Semiconductor Mission 2.0; focus shifts to equipment, IP and supply chains

Other allocations include pharmaceutical drugs (Rs 15,000 crore), bulk drugs (Rs 6,940 crore), telecom (Rs 12,195 crore), food products (Rs 10,900 crore), textiles (Rs 10,683 crore), specialty steel (Rs 6,322 crore), white goods (Rs 6,238 crore), medical devices (Rs 3,420 crore), and drone components (Rs 120 crore).

Highlighting the sector’s long-term growth, Union Minister for Electronics and IT Ashwini Vaishnaw said electronics production has increased six-fold in the last 11 years, while exports have grown eight times. Electronic goods production rose from Rs 1.9 lakh crore in 2014-15 to Rs 11.3 lakh crore in 2024-25, while exports jumped from Rs 0.38 lakh crore to Rs 3.3 lakh crore.