Speaking at the Bharat Mobility Global Expo 2025, Prime Minister Modi attributed this impressive growth to several key factors, including India’s young and dynamic population, rising income levels, a rapidly expanding middle class, and government initiatives like the “Make in India” and Production-Linked Incentive (PLI) schemes.

Key Drivers of Growth

India’s automotive boom is largely driven by its burgeoning middle class, increasing urbanization, and the government’s investment in infrastructure development. The Prime Minister emphasized that the country’s young population, coupled with growing economic prosperity, has played a significant role in boosting demand for vehicles. With over 25 crore people moving out of poverty in the last decade, a new middle class has emerged with greater purchasing power and ambition, further stimulating demand for cars.

“In the last ten years, over 25 crore people came out of poverty, and this new middle class will buy vehicles,” said Prime Minister Modi. He also pointed out that the improved road infrastructure, multi-modal connectivity, and the advent of smart mobility solutions, such as Fastag, are all contributing to the rapid growth of the automotive industry.

The Role of Government Initiatives

The Indian government’s focus on infrastructure development is crucial to the future success of the automotive sector. In the recent Union Budget, more than Rs 11 lakh crore were allocated for the expansion of highways, multi-lane roads, and better connectivity across the country. These initiatives are expected to not only ease travel but also significantly reduce transportation costs, further stimulating vehicle sales.

Additionally, the “Make in India” initiative has been pivotal in making affordable vehicles accessible to the domestic market. This initiative has encouraged automobile manufacturers to ramp up production in India, reducing costs and making cars more affordable for the growing middle class.

India as a Global Manufacturing Hub

PM Modi also highlighted India’s increasing role as a global manufacturing hub for automobiles. The country is not only catering to its domestic demand but is also expanding its presence in international markets. Under the “Make in India, Make for the World” mantra, India’s automotive exports have been on the rise, showcasing the country’s potential as a global leader in car production.

India’s automotive industry is now poised for a major leap forward, as more companies set up manufacturing plants in the country, taking advantage of the PLI scheme and other supportive policies. These efforts are expected to make India a key player in the global automotive market.

Smart Mobility and Sustainable Growth

Looking ahead, the Prime Minister believes that the future of India’s automotive sector will be shaped by cutting-edge technologies and a focus on sustainable mobility solutions. With the growing emphasis on electric vehicles (EVs) and smart mobility, the sector is on track to embrace innovations that will further transform the way people travel.

“The journey of developed India is going to be a journey of unprecedented transformation and many-fold expansion of the mobility sector,” said Modi. He emphasized that as India moves toward smart mobility, the adoption of technologies like EVs, autonomous vehicles, and integrated transportation solutions will help make travel more efficient and environmentally friendly.

Conclusion

India’s automotive sector is experiencing unprecedented growth, driven by a combination of demographic factors, rising incomes, government policies, and a focus on infrastructure development. With the support of both the public and private sectors, India is on the path to becoming a global hub for automobile manufacturing and a leader in smart mobility solutions. The coming years are expected to witness a remarkable transformation in India’s automotive landscape, contributing significantly to the country’s vision of becoming a developed nation.

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This state-of-the-art facility is situated in the Madras Export Processing Zone (MEPZ) and represents a crucial expansion of India’s manufacturing capabilities, now stretching beyond mobile phones into the realm of IT hardware, particularly laptops. The assembly line, which will initially produce 100,000 laptops annually, is set to scale up to a capacity of 1 million units over the next 1-2 years. Syrma SGS already operates four manufacturing units in Chennai, with Unit 3 now focusing on laptop production.

During the inauguration, Minister Vaishnaw emphasized the importance of developing a comprehensive electronic component ecosystem. He noted, “We must work meticulously to ensure that the electronic component ecosystem is also developed in the coming time. This will not only drive a major growth story for India but also align with our vision of Atmanirbhar Bharat, fostering self-reliance and strengthening our position in the global electronics manufacturing landscape.”

The new initiative is part of the Production Linked Incentive (PLI) 2.0 scheme for IT Hardware, which is designed to boost India’s capabilities in high-value electronics manufacturing while enhancing self-reliance in the IT hardware sector. Syrma SGS has partnered with Micro-Star International (MSI), a leading Taiwanese tech company, to manufacture laptops of the highest quality in India. These laptops will cater to both domestic and international markets.

This development is expected to create 150-200 specialized jobs in electronics manufacturing by FY26, providing a significant boost to the economy of Tamil Nadu and the nation. The creation of these roles is expected to positively influence the workforce, strengthening the future talent pool in this sector. The laptops produced at this facility will adhere to international quality standards, further showcasing India’s growing technical and manufacturing expertise.

India’s electronics manufacturing sector has seen tremendous growth in the past decade. In 2014, the sector’s total production was valued at Rs 2.4 lakh crore, a figure that has now surged to Rs 9.8 lakh crore in 2024. Mobile manufacturing alone has reached Rs 4.4 lakh crore, with exports contributing Rs 1.5 lakh crore to the economy in 2024. Currently, 98 per cent of mobile phones used in India are manufactured locally, and smartphones have become the country’s fourth-largest export.

Tamil Nadu, a key player in India’s electronics manufacturing, has over 47 manufacturing units supported by various schemes from the Ministry of Electronics and Information Technology (MeitY). The state stands out as one of the largest beneficiaries of the PLI scheme for Large-Scale Electronics Manufacturing, with seven out of the 27 approved units under PLI 2.0 based there. Notably, the first unit under this initiative was inaugurated yesterday.

Additionally, Tamil Nadu has received substantial backing through initiatives such as the Scheme for Promotion of Manufacturing of Electronic Components and Semiconductors (SPECS), with MeitY providing Rs 1,200 crore in support for four applications. The Modified Special Incentive Package Scheme (M-SIPS) has also attracted 33 applications with an investment potential of Rs 15,000 crore and MeitY’s backing of Rs 1,500 crore. These programs have helped Tamil Nadu achieve a total production exceeding Rs 1.3 lakh crore.

The state also hosts the Electronics Manufacturing Cluster (EMC) at Pillaipakkam Village, Sriperumbudur, set up by M/s State Industries Promotion Corporation of Tamil Nadu (SIPCOT). With an investment of Rs 420 crore, including Rs 210 crore from the Government of India, this cluster is expected to draw investments of Rs 8,700 crore and generate 36,300 jobs.

Tamil Nadu accounts for around 30 per cent of India’s electronics exports, solidifying its central role in the nation’s electronics industry. The state also recently gained attention for manufacturing the latest iPhone 16 Pro, which is proudly “Made in India.”

The inauguration of Syrma SGS’s laptop assembly line is seen as a significant milestone in India’s journey towards reducing dependency on imports and expanding its manufacturing capabilities. As the facility increases its production, India is poised to become a global leader in IT hardware manufacturing.

The PLI 2.0 scheme for IT Hardware, which was launched on May 29, 2023, is another driving force behind this growth. It offers a 5 per cent incentive to eligible companies, covering products such as laptops, tablets, all-in-one PCs, servers, and ultra-small form factor devices. With an investment target of Rs 3,000 crore, PLI 2.0 aims to drive production worth Rs 3.5 lakh crore and create 47,000 jobs across India.

The scheme has already made remarkable progress, with investments of Rs 520 crore, production worth Rs 10,000 crore, and the creation of 3,900 jobs by December 2024. This reflects the substantial impact that the initiative is having on the electronics manufacturing landscape in India.

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