India plots second telecom PLI scheme with enhanced local value focus

India's telecom sector is set to benefit from an upgraded incentive programme as the government shapes a second edition of its production-linked incentive (PLI) scheme with heightened emphasis on locally-designed and manufactured components.

The Ministry of Communications has initiated work on the revised telecom PLI proposal, which officials said will prioritize design-led higher value addition in the manufacturing process. The scheme is currently navigating inter-ministerial consultation channels before seeking final clearance from the Union Cabinet.

The first edition of the telecom PLI scheme, which concluded in March 2026, demonstrated significant industry traction. The programme attracted Rs 6,073 crore in investments against an initial target of Rs 4,115 crore, exceeding projections by nearly 48 per cent. Forty-two companies, including 28 micro, small and medium enterprises, secured approvals under the scheme for telecom and networking products, with 17 firms applying for an additional 1 per cent incentive under design-led manufacturing criteria.

The original scheme operated with a budgetary outlay of Rs 12,195 crore. Officials indicated that the forthcoming iteration will build on lessons from the first phase while introducing stricter parameters to encourage domestic design capabilities and reduce reliance on imported technologies and intellectual property.