“We are working on this, and as you know, we believe in broad consultation with the industry. That consultation process is practically in its final stages,” Vaishnav told CNBC-TV18 at the World Economic Forum in Davos.
Vaishnav said the scheme is likely to be presented before the Union Cabinet soon and could be launched in the next few months.
This confirms CNBC-TV18’s January 6 newsbreak that the Finance Ministry has approved an outlay of ₹25,000 crore for the scheme.
Also read: Finance Ministry approves electronic components PLI scheme
While the industry had sought ₹40,000 crore, MeitY may consider increasing the budget based on the plan.
The PLI scheme aims to attract investments of over ₹40,000-₹45,000 crore, focusing on key components such as sub-assemblies of printed circuit boards (PCBs), batteries, displays and camera modules. If the Cabinet gives its approval, the scheme is likely to be announced in the upcoming Union Budget 2025-26 (FY26) on February 1.
These are edited excerpts of the interview.
Question: Tell me what was the thought process here for setting up all the state pavilions integrated within the India pavilion?
Answer: The thought process was that the India pavilion should be unified, unified. Our Prime Minister, Shri Narendra Modi ji got this feedback after Davos last year, and he emphasized, and he gave us a very clear thought process that we should integrate all the state pavilions within the India pavilion. Then we spoke to the Chief Ministers, and they were all really happy to be a part of this thought process and that’s why we have this pan India pavilion – one unified, one integrated.
Question: Let’s talk about the other big development that is President Trump in the White House. Of course, the External Affairs Minister has met his counterpart in the US. After the inauguration we have iCET between India and the US, which focuses on partnership on critical and emerging technologies. What to expect? A lot of progress has been made in these areas under the Biden administration. Now what do you expect from this current regime?
Answer: I think it will accelerate, in terms of technology, in terms of economy, in terms of foreign policy. The core point of Prime Minister Modi’s thinking is trust and trust in our relations with America, with Europe is a very Is an important element. , with Japan. This has really helped us in getting the MOUs and MOCs signed. Because people really believe that, yes, India is a country, India is a geography, it is an economy that can be trusted, and I would say that this trust will drive our cooperation.
Question: What would be the expectation, what would be the focus areas that you would like to be prioritized by both sides when we talk about technology?
Answer: Critical minerals will be a very important priority. Then we will have quantum, we will have AI, changing the way models are being built and the way models will be used in the future. Could we have more focused models that fit our own needs, these would be vital to solving our problems. Semiconductor supply chain, value chain will not only be a very important part of it, apart from this many emerging technologies where we can contribute significantly through our talent pipeline will also be a part of it. Research, last year we had decided to start some joint research programs which would also be a focus area.
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Question: Talking about China, it has been a tense relationship, but now there is movement as far as border issues are concerned. Will this increase engagement on the economic side as well? Do you believe there is a need for engagement with China on the economic side?
Answer: As our External Affairs Minister S Jaishankar has said, this is a very complex relationship where the governments of both countries are deeply engaged in finding the right way forward. What I would like to say is that our next step in building the component ecosystem in India is progressing very well. We have completed its entire structure, which are the focus areas where we will put maximum energy. What has happened, you might have seen yourself, since you do a very interesting Young Turks programme, you might have seen that some of the supply chain partners, some of the Indian manufacturers, have really moved up the learning curve, and many of these players Confidence is amazing.
I was just talking to Mr. Lores, the head of HP laptop manufacturing company, he said that now we feel so confident within such a short time frame of two years that we would like to set up a complete R&D facility, complete design The facility, now in India, with partners of their choosing. Same is the case with HP Enterprise, the server manufacturing HP Enterprise head told me they are now scaling it up to about 4,000 servers per month, and the entire design work will be done in India.
What I want to say is that the challenges that we faced in the learning curve, let’s say, five years ago, seven years ago, are much less now. Yes, it will always be like that – when you want to start something new it will have its own challenges, but I think our country, our industry and our policy framework today is capable of taking it.
Question: There has been talk about policy measures and production linked incentive (PLI) scheme for the electronic components sector. Is it likely to be announced soon?
Answer: We are working on it, and very extensively, as you know, we believe in extensive consultation with the industry, so that consultation process is practically in its final stages. I would like to announce it after getting approval from the cabinet.
Q: How long will you take it to the cabinet?
Answer: We should be able to launch the program in the coming few months’ time frame.
Question: Do you believe that with the Trump regime, the need of the hour would be for us to look preemptively at what we can do on tariffs across the board?
A: This is more of a simplification and has less number of slabs, so that there is no confusion between one component and another. In electronics, each component must pass through a number of limitations until a module is formed. So this means that the component, let’s say, has another very small sub component added to it, can change the classification. What we want is a very simple, very clearly defined classification system and we will continue to work in that direction.
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Question: Isn’t a rate cut necessary?
Answer: It comes as a part of it.
Question: Are you expecting rate reduction as well as simplification?
Answer: It is something more complicated than just putting these two words together.
Is this likely to be partly budget related?
Answer: I would not like to speculate on this, but yes, we are in constant touch with the industry.
Question: Do you believe that the government needs to intervene further to provide some relief and assistance when we talk about the issue of outstanding AGR reports?
Answer: You will have to ask Scindia ji about this, I would not like to comment on that.
Question: We were just talking about the progress being made with respect to the AI mission. What will be the priority in 2025?
Answer: The three top priorities will be, compute power is ready, where we have completed the RFP process, and very soon price discovery and everything else will be in place. The second would be talent development, as you have seen in other programs on technology, our focus on talent development is very much aligned with industry. In terms of communications, we have set up 5G laboratories in 100 universities so that students can get real-world experience of working on 5G technology.
In the case of semiconductor, we have it in 240 universities where students are actually designing chips using the latest equipment. This is what we are doing in AI, so a very large number of universities are collaborating to provide AI preparation as well as AI research and application experience. This is another matter.
The third very interesting approach is to prepare data sets for AI. We have big data sets of non-personal data, transportation data. We have agriculture data, weather data, logistics data. How we can use it to create data sets that are ready for AI is the third thing.
Apart from these three top immediate priorities, we are also working with the industry to understand how we can have our own models. What kind of models should we create? Should they be general models, or focused models and in parallel, we are also working with the industry to see in a three to five year time frame whether we can have our own GPUs? All this development is happening in a very systematic manner, in a very systematic manner. Hopefully in the near time frame, in the near future, let’s say, six to eight months, we will articulate these ideas on the model as well as the chip. But in other parts we are moving ahead in the implementation phase.
Question: Will this policy continue with government spending on government capital expenditure and growth driven by government capital expenditure, at least for now?
Answer: I would say that is one of the triggers, but other triggers like manufacturing, triggers like housing, drivers like innovation and gaining efficiency, productivity, all these triggers, all help in the growth of GDP.
Question: What will be the title of 2025 from India’s perspective?
Answer: Reliable country, very clear, very stable political governance, very stable policy governance, good focus on inclusive growth, what we have done in the last 10 years.
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