This report serves as a practical guide for Taiwanese ICT an electronic components manufacturers looking to build a serious presence in the Indian market. Written from the perspective of Taiwan as a global hardware leader, it examines how India is using policy incentives and regulatory frameworks to push its electronics industry beyond simple assembly toward more sophisticated component manufacturing. For Taiwanese companies, this represents not only an opportunity to expand into a large market, but also a timely chance to restructure global supply chains and use India as a regional export hub.

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Below is a summary of the five core topics covered in the report:

1. Central and State Government Incentive Programs (PLI & State Incentives)

The Indian government offers multi-layered subsidy programs to attract Taiwanese investment.

Central-level incentives: The Large-Scale Electronics Manufacturing (LSEM) PLI scheme offers incremental sales incentives of 4–6%, while SPECS provides a 25% capital expenditure subsidy for capital-intensive sectors such as PCB and passive components.
Semiconductor support: The India Semiconductor Mission (ISM) offers fiscal support of up to 50% for semiconductor fabs, OSAT facilities, and sensor manufacturing, making it a highly attractive program.
State-level competition: Individual states offer additional incentives — Karnataka focuses on R&D and GCC subsidies, while Tamil Nadu has launched India’s first state-level electronics component incentive scheme, offering top-up subsidies of up to 50%.

2. Regulatory Compliance and Certification Standards (Compliance & BIS Standards)

Entering the Indian market requires navigating a complex set of compliance requirements.

BIS certification: Electronic products must pass the Bureau of Indian Standards (BIS) Compulsory Registration Scheme (CRS). Foreign manufacturers are required to appoint an Authorized Indian Representative (AIR) to maintain ongoing compliance.
Environmental responsibilities: Under the 2022 E-Waste Management Rules, producers and importers must establish take-back and recycling systems (EPR) and obtain air and water discharge permits.
Labor regulations: Factory operations must comply with the Factories Act 1948, covering safe working conditions and state-specific permits for female and night-shift workers.

3. Supply Chain Localization Challenges and Key Gaps (Supply Chain Localization)

Despite the rise of manufacturing in India, significant import dependency remains at the upper end of the supply chain.

High import reliance: India currently imports 80–85% of its semiconductors, PCBs, and passive components, particularly in the high-end HDI and multilayer board segments.
Component gaps: Domestic production capacity for passive components such as MLCCs, resistors, and connectors falls well short of demand, with local value-add rates at only around 15–20%.
Logistics and lead times: Imported components typically require 4–8 weeks of lead time and are vulnerable to cost increases caused by global disruptions such as the Red Sea crisis.

4. Intellectual Property Protection and Technology Transfer (IPR & Tech Transfer)

For Taiwanese companies with proprietary technology, protecting intellectual property in India is a top priority.

Patent strategy: It is advisable to complete Indian patent or trademark filings before commencing manufacturing, and to extend copyright protection to firmware and design documentation.
Technology transfer agreements: When entering technology licensing or contract manufacturing arrangements, clearly define IP ownership and restrictions on sub-licensing. Source code escrow arrangements should be considered where appropriate.
Transfer pricing: All intra-group transactions must follow the arm’s length principle, and transfer pricing documentation should be prepared in advance to withstand tax audits.

5. Import Tariff Adjustments and Regional Trade Agreements (Tariff & FTAs)

India’s tariff policy is shifting toward encouraging domestic production of key components.

Tariff reductions: The 2025 budget eliminated import duties on key components including mobile phone PCBAs, camera modules, and lithium battery materials, with the aim of lowering the cost of local assembly.
FTA benefits: India has free trade agreements with ASEAN, Japan, South Korea, and the UAE. Products meeting the applicable rules of origin (RoO) can access these markets at preferential tariff rates.
Standards recognition: Products that meet both international and BIS standards face fewer technical barriers to trade (TBT), which can help facilitate exports from Indian facilities to markets in Europe, the US, and beyond.