Union Budget 2025: India to Revamp Customs Policies for Revenue and Growth
In the Union Budget 2025, Finance Minister Nirmala Sitharaman is expected to unveil significant changes to India’s customs policies, focusing on leveraging tariffs to enhance government revenue while fostering domestic industry growth. The revamped customs framework aims to strike a balance between protecting local businesses and encouraging global trade partnerships. Measures such as targeted tariffs on non-essential imports and incentives for domestic manufacturing are likely to play a key role in supporting the “Make in India” initiative, reducing reliance on foreign goods, and stimulating economic activity. Additionally, modernizing customs processes through digitization and streamlining administration is expected to improve ease of doing business and enhance India’s appeal as an investment destination.
For non-Indian companies, these changes carry critical implications. Higher tariffs on imports could raise costs for businesses reliant on the Indian market, while incentives for local manufacturing present opportunities for foreign firms to establish or expand operations in India. Furthermore, streamlined customs processes may facilitate smoother trade, potentially offsetting some of the impacts of increased tariffs. Companies operating in sectors such as electronics, machinery, and raw materials should closely monitor these developments to adapt their strategies for the Indian market.
Editor’s Note: In the Union Budget 2025, India plans to revamp customs policies by introducing targeted tariffs on non-essential imports and incentives for domestic manufacturing to boost revenue and promote the “Make in India” initiative. The modernization of customs processes through digitization aims to enhance ease of doing business and attract investment. Taiwanese companies operating in sectors like electronics and machinery will need to assess how higher tariffs may increase costs, but also explore opportunities to expand their operations in India due to incentives for local manufacturing.
India’s Data Centre Capacity to Double by FY27 Amid Digital Boom
India’s data centre capacity is projected to more than double to 2-2.3 GW by FY27, according to Crisil Ratings, driven by increasing digitalisation and the growing adoption of cloud storage solutions by enterprises. The rise of Generative Artificial Intelligence (GenAI), which requires higher computational power and lower latency, is further expected to boost demand in the medium term. Additionally, government initiatives on data localisation and state-level incentives are attracting significant investments in the sector. With mobile data traffic growing at a CAGR of 25% over the past five years and expected to reach 33-35 GB per month by FY26, the sector is poised for rapid growth, requiring investments of $6.46–7.64 billion in infrastructure like land, power, and cooling systems over the next three years.
This presents a valuable opportunity for foreign companies to invest in India’s burgeoning data centre ecosystem. Global technology firms and hyperscalers can explore partnerships with Indian providers or establish their facilities to meet the surging demand for cloud computing and data solutions. The Indian market’s focus on localisation and infrastructure expansion aligns well with international firms seeking to tap into a rapidly growing digital economy.
https://www.ibef.org/news/india-s-data-centre-capacity-to-more-than-double-by-fy27-crisil-report
Editor’s Note: India’s data centre capacity is set to more than double to 2-2.3 GW by FY27, driven by digitalization, the rise of Generative AI, and government initiatives supporting data localisation. This growth, fueled by increasing mobile data traffic and required investments in infrastructure, offers significant opportunities for foreign investment. Global firms, including Taiwanese companies in technology and cloud services, can benefit from partnerships with Indian providers or by establishing their own facilities to capitalize on the expanding digital ecosystem and local data requirements.
Karnataka to Host State’s First Semiconductor Project; Investments Cross ₹9,800 Crore
Chief Minister Siddaramaiah announced on Monday that Karnataka’s first semiconductor manufacturing unit will be established by Silectric Semiconductor at the Kochanahalli Electronics Manufacturing Cluster near Mysuru, with an investment of ₹3,426 crore. Promoted by Radha Vembu, cofounder of Zoho Corporation, Silectric will operate in silicon carbide-based fabrication and assembly, testing, marking, and packaging (ATMP). This initiative is set to create 460 jobs and will encompass the end-to-end production of modules and MOSFETs. The CM emphasized strict timelines for investors utilizing KIADB plots, warning of penalties for delays in commissioning their units.
Karnataka’s emphasis on semiconductor and advanced manufacturing presents a valuable opportunity for global companies. Silectric’s initiative, along with other significant investments in ITIR, Devanahalli, and Harohalli, highlights the state’s dedication to building a strong manufacturing infrastructure. With extensive financial support, government incentives, and a focus on cutting-edge technologies, Karnataka emerges as a promising hub for international tech firms seeking partnerships or expansion in India’s burgeoning semiconductor and electronics sectors.
Editor’s Note: Karnataka will host its first semiconductor manufacturing unit, with Silectric Semiconductor investing ₹3,426 crore to set up a facility near Mysuru for silicon carbide-based fabrication and assembly. The project, expected to create 460 jobs, is part of Karnataka’s broader push to build a robust semiconductor and advanced manufacturing ecosystem. This is a noteworthy development in India’s semiconductor sector, highlighting the state’s growing role in the industry.
MSI Commences Laptop Manufacturing in India, Strengthens Local Presence
Taiwanese laptop maker MSI has launched its first manufacturing facility in Chennai, marking a significant step in its commitment to the “Make in India” initiative. The facility will produce locally assembled versions of the MSI Modern 14 and MSI Thin 15 laptops, with prices starting at ₹52,990 and ₹73,990, respectively. MSI stated that India has emerged as one of its fastest-growing markets, driven by rising demand for high-performance laptops. To enhance accessibility, the brand plans to expand its presence through additional brand stores and partnerships with retailers like Croma and Reliance Retail.
For global companies, MSI’s move underscores India’s growing appeal as a manufacturing hub and its potential to serve as a base for both domestic and international markets. The initiative highlights the advantages of local production, including cost efficiencies, reduced supply chain challenges, and alignment with India’s focus on self-reliance in technology. MSI’s expansion sets a precedent for other global tech firms aiming to penetrate India’s burgeoning consumer market while supporting the nation’s technological growth.
Editor’s Note: MSI has opened its first laptop manufacturing facility in Chennai, producing locally assembled MSI Modern 14 and MSI Thin 15 laptops to meet growing demand in India. The move highlights India’s potential as a manufacturing hub, offering cost efficiencies and aligning with the country’s “Make in India” initiative. Increasing numbers of Taiwanese companies, like MSI, are localizing their production in India, capitalizing on government policies promoting self-reliance in technology.
India Announces 30% Subsidy to Boost Electric Ambulance Production Under PM E-DRIVE Scheme
The Indian government has unveiled plans to offer up to a 30% subsidy for manufacturing electric ambulances (e-ambulances) as part of its ₹10,900 crore PM E-DRIVE scheme. This initiative, launched on October 1, dedicates ₹500 crore specifically to promoting e-ambulances, with the goal of encouraging early adoption and fostering sustainable healthcare practices. The subsidy will apply to patient transport vehicles, basic life support ambulances, and advanced life support ambulances, with the amount linked to battery capacity to ensure efficiency and performance. Collaboration between the Ministry of Heavy Industries, the Ministry of Health, and the National Health Mission (NHM) aims to establish robust safety and performance standards.
For non-Indian companies, this move highlights a growing opportunity in India’s green mobility and healthcare markets. By incentivizing local manufacturing and aligning with global sustainability trends, India’s e-ambulance initiative opens avenues for international firms to contribute innovative technologies and form partnerships. The adoption of eco-friendly ambulances in one of the world’s largest healthcare systems could also set a benchmark for other developing countries looking to implement similar sustainable solutions.
Editor’s Note: India has introduced a 30% subsidy for manufacturing electric ambulances under the ₹10,900 crore PM E-DRIVE scheme, aiming to promote sustainable healthcare practices. The ₹500 crore dedicated to e-ambulances will support the production of patient transport, basic, and advanced life support vehicles with a focus on performance and efficiency. Taiwanese companies in the EV and related sectors can seize this opportunity to collaborate with Indian manufacturers, contributing innovative technologies and capitalizing on India’s growing green mobility market.
Indian Bicycle Industry Pushes for PLI Scheme to Boost Competitiveness and Sustainability
The Indian bicycle industry, encompassing both traditional and electric bicycles, is advocating for a Production Linked Incentive (PLI) scheme to address key challenges and enhance its global competitiveness. Despite bicycles’ critical role in promoting sustainable transportation and Net Zero goals, the sector struggles with slow technological adoption, limited infrastructure, inadequate manufacturing investment, and weak standardization. Industry experts believe that a PLI scheme could drive innovation, attract investments, and position India as a strong player in the global bicycle market, especially against dominant Chinese counterparts. Dr. K.B. Thakur, Secretary General of the All India Cycle Manufacturers’ Association (AICMA), emphasized the need for collaboration between technology pioneers and urban planners to unlock the sector’s potential for redefining micro-mobility and fostering active transportation.
For non-Indian companies, the push for a PLI scheme represents a significant opportunity. Global manufacturers and technology providers could explore partnerships with Indian firms to bring advanced designs, safety features, and smart technologies to a market poised for growth. Additionally, aligning with India’s vision for sustainable mobility could open doors to new markets and innovation hubs, creating mutually beneficial avenues for growth and development in the bicycle industry.
Editor’s Note: The Indian bicycle industry is advocating for a Production Linked Incentive (PLI) scheme to enhance global competitiveness and drive innovation, addressing challenges like slow technological adoption and limited infrastructure. The scheme aims to position India as a key player in the global bicycle market, promoting sustainability and active transportation. Taiwanese companies in the bicycle and EV sectors can explore partnerships in India to bring advanced designs and smart technologies, benefiting from the growing demand for innovative, eco-friendly transportation solutions.
Micromax Joins Hands with Phison to Develop AI-Focused Storage Chips in India
Micromax, a leading Indian electronics company, has entered a joint venture with Taiwan-based Phison to design and produce solid-state drives (SSDs) and storage chips domestically. The new venture, MiPhi, will be 55% owned by Micromax and will specialize in advanced NAND storage solutions for applications in AI, enterprise, and automotive sectors. Among its innovations is aiDAPTIV, a product designed to significantly reduce the cost of training AI models by enabling models with 400 billion tokens to operate on just 8 GPUs instead of the usual 70-80. The manufacturing will be carried out at Micromax’s facility in Noida, with commercial production set to begin next year. Co-founder Rahul Sharma highlighted the initiative as a step toward making India self-sufficient in storage chip technology and revolutionizing the global AI ecosystem through cost-effective solutions.
For international businesses, MiPhi presents an opportunity to partner on innovative, AI-driven, and cost-efficient storage technologies. Leveraging India’s growing manufacturing capabilities and market demand, the venture is poised to be a strong contender in global sectors such as AI, IoT, and automotive. Phison’s technical expertise further adds value, providing non-Indian companies a gateway to advanced semiconductor solutions tailored for emerging markets.
Editor’s Note: Micromax has partnered with Taiwan-based Phison to establish MiPhi, a joint venture focused on designing and producing AI-driven storage chips and SSDs in India, with commercial production set to begin next year. The venture aims to revolutionize the AI, enterprise, and automotive sectors, offering cost-effective solutions like the aiDAPTIV product for efficient AI model training. This collaboration between Indian and Taiwanese companies combines local manufacturing expertise with advanced semiconductor knowledge, positioning the partnership to drive India’s self-sufficiency in storage chip technology and create significant opportunities for both markets.
Daikin India and Rechi Precision Forge JV to Manufacture Rotary Compressors
Daikin India, a wholly-owned subsidiary of Japan’s Daikin Industries, has announced a joint venture with Taiwanese compressor manufacturer Rechi Precision to design, manufacture, and sell rotary compressors, including inverter and non-inverter models, in India and select international markets. Daikin will hold the majority share in this venture, which aims to address the growing demand for cost-effective and reliable compressors in India’s expanding air conditioning market. The JV, which is expected to begin operations by the fourth quarter of the current financial year, includes plans for a new manufacturing plant in Sri City, Andhra Pradesh, spanning 33 acres. The partnership is seen as a strategic move to localize production, alleviate supply shortages, and support the Indian government’s “Make in India” initiative.
Rechi Precision, renowned for its innovative rotary compressor technology, will contribute its expertise in research, development, and production engineering to the venture. With Daikin India’s extensive sales network and strong brand reputation, the collaboration aims to deliver affordable and efficient air conditioning solutions tailored to both residential and commercial sectors. This partnership marks Daikin India’s first in-country collaboration and aligns with the company’s strategy to expand its presence in India while strengthening its commitment to sustainable growth in the region.
For global companies, this JV presents an opportunity to tap into India’s rapidly growing HVAC market, which is witnessing increasing demand for affordable, energy-efficient solutions. The partnership between Daikin and Rechi offers a competitive edge in terms of cost-effective manufacturing, product development, and access to India’s burgeoning consumer base, making it an attractive proposition for non-Indian firms looking to expand their footprint in the region.
Editor’s Note: Daikin India has formed a joint venture with Taiwanese compressor manufacturer Rechi Precision to design and produce rotary compressors, addressing the growing demand for cost-effective air conditioning solutions in India and select international markets. The JV will operate a new manufacturing plant in Sri City, Andhra Pradesh, leveraging Rechi’s technological expertise and Daikin’s extensive sales network to deliver energy-efficient products and support India’s “Make in India” initiative. This collaboration between Taiwan and India combines advanced technology with local manufacturing capabilities, offering a competitive edge in the rapidly expanding HVAC market.