India’s electronics and technology sector has welcomed Union Budget 2026-27 with cautious optimism, praising the government’s ₹40,000 crore allocation for the Electronics Components Manufacturing Scheme and the expansion of India Semiconductor Mission (ISM) 2.0 as decisive steps toward building a resilient, self-reliant manufacturing ecosystem.
From consumer electronics to AI-driven security solutions, industry leaders see the budget as a catalyst for transforming India from a technology consumer to a global innovation hub.
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Semiconductor Push: From Aspiration to Execution
Mr. Aditya Khemka, Founder & Managing Director, CP PLUS, emphasized the strategic significance of ISM 2.0: “This Budget signals a decisive shift in India’s technology and security journey, with a clear focus on building capability at home. The strengthened push under ISM 2.0 ensures that the intelligence, computing power, and hardware powering next-generation AI systems are designed and manufactured in India.”
The emphasis on AI adoption for mission-critical applications—including public safety, surveillance, and smart infrastructure—positions India not just as a consumer of advanced technologies, but as a trusted creator of AI-led security solutions aligned with Make in India principles.
Mr. Murali Mantravadi, Joint Managing Director, Energy Bots – Flosenso, offered a measured perspective: “What becomes clear is a steady shift in how technology is being viewed. The push through ISM 2.0 and higher investment in electronic components suggests the government wants India to build deeper capability, not just scale services. Sustainable advantage comes from owning design, supply chains and execution, not only distribution.”
Electronics Manufacturing: Doubling Down on Components
The near-doubling of the Electronics Components Manufacturing Scheme outlay from ₹22,919 crore to ₹40,000 crore drew widespread acclaim as a game-changer for domestic supply chain development.
Mr. Ravi Agarwal, Co-Founder and Managing Director, Cellecor, noted: “This is a meaningful step toward building a stronger domestic component supply chain. The parallel focus on employment generation and large-scale skilling in electronics manufacturing will help create a future-ready workforce across factories, assembly lines, and service ecosystems.”
Mr. Pankaj Rana, CEO, Hisense India, highlighted the macro impact: “The sustained focus on semiconductor manufacturing, electronics components, and AI-led innovation reflects strong policy commitment to building a resilient domestic ecosystem. For the consumer electronics industry, this creates a stable, growth-oriented environment that encourages long-term investments, innovation, and localisation.”
Mr. Ritesh Goenka, Managing Director, Damson Technologies, emphasized supply chain resilience: “The expansion of ISM 2.0 with a ₹40,000-crore outlay, along with enhanced support for electronics components, clearly affirms the government’s commitment to building deep, resilient supply chains and strengthening indigenous IP capabilities in high-tech sectors.”
MSME Empowerment: Patient Capital for Electronics Startups
The budget’s ₹10,000 crore MSME Growth Fund and ₹2,000 crore top-up to the Self-Reliant India Fund address critical financing gaps for small and medium electronics manufacturers.
Mr. Imran Kagalwala, Co-Founder, Unix India, welcomed the equity focus: “The MSME Growth Fund aimed at developing Champion MSMEs helps address the long-standing need for patient equity capital, allowing companies to scale in a more balanced manner. The ₹2,000 crore top-up to the Self-Reliant India Fund further supports long-term risk capital, contributing to a more stable environment for innovation and growth.”
Mr. Ashok Rajpal, Managing Director, Ambrane India, highlighted specific benefits for powerbank manufacturers: “The continued push under ISM 2.0, together with the increased outlay for electronics components and the reduction in duties on batteries, provides a more supportive environment for domestic powerbank and electronics manufacturers to scale operations and invest in innovation.”
Consumer Durables: Export Competitiveness Gets a Boost
Mr. NS Satish, President, Haier Appliances India, connected the budget to global trade dynamics: “The ₹40,000 crore allocation towards electronics components is a landmark announcement that will strengthen the domestic supply chain and accelerate localization. Coupled with the recently concluded India-EU Free Trade Agreement, which opens new avenues for technology collaboration and exports, this Budget reinforces India’s position as an increasingly preferred manufacturing hub.”
The synergy between domestic manufacturing incentives and improved trade access creates cost efficiencies, improved affordability, and expanded appliance penetration across emerging markets, positioning India as a globally competitive consumer durables exporter.
Mr. Paresh Vij, Director, U&i, echoed the competitive positioning: “These measures will enable faster innovation, better cost efficiencies, and improved supply-chain resilience for consumer electronics brands. The budget provides much-needed policy stability and confidence for sustained investments in manufacturing, technology, and talent.”
Education-to-Employment: Building a Tech-Ready Workforce
Mr. Rajeev Singh, Managing Director, BenQ India and South Asia, highlighted the human capital dimension: “The proposed Education-to-Employment Standing Committee acknowledges the urgent need to align learning with industry demand and the accelerating impact of technologies such as AI. Initiatives such as Content Creator Labs in 15,000 schools mark an important shift towards hands-on, technology-enabled learning environments.”
The convergence of manufacturing incentives with skills development ensures that India’s electronics ecosystem has access to a globally competitive, technology-literate workforce—critical for sustained innovation and quality manufacturing.
Digital India: From Adoption to Creation
Mr. Bhanu Pratap Singh Tanwar, CEO and Co-founder, Interact Group, framed the budget as enabling India’s transition from technology consumer to creator: “The Government’s sustained focus on emerging technologies such as AI, gaming and the broader AVGC sector, alongside continued investments in digital public infrastructure and skilling, is enabling Indian startups to transform aspiration into achievement and move decisively from technology adoption to technology creation.”
His emphasis on “Yuva Shakti at the centre of India’s growth story” reflects the budget’s alignment with demographic advantages—empowering India’s young, digitally-native population to build globally relevant solutions while remaining deeply rooted in Indian users and realities.
AI and Quantum: Strengthening the Technology Backbone
Mr. Rahul Garg, Founder-CEO, Moglix, highlighted industrial applications: “The Budget’s emphasis on AI, quantum research and innovation-led missions strengthens India’s technology backbone. These investments enable enterprises to deploy AI across manufacturing optimisation, procurement automation and supply chain forecasting.”
The integration of emerging technologies with traditional industries—textile modernization, industrial cluster rejuvenation—demonstrates a holistic approach where AI becomes a productivity multiplier rather than a standalone technology initiative.
The Road Ahead: Execution Will Define Success
While industry sentiment is overwhelmingly positive, leaders acknowledge that implementation quality will determine outcomes. As Mr. Mantravadi cautioned: “The real test now is execution, but the intent feels more structural than symbolic.”
The budget creates a supportive policy environment, but transforming India into a global electronics manufacturing powerhouse requires:
- Timely disbursal of allocated funds
- Streamlined approval processes for manufacturing incentives
- Coordination between central and state governments for ease of doing business
- Sustained focus on quality control and global competitiveness
The Verdict: Foundation for Viksit Bharat
Union Budget 2026-27’s electronics sector provisions represent a comprehensive, long-term commitment to Atmanirbhar Bharat. From semiconductors to consumer electronics, AI to quantum computing, the budget addresses both immediate supply chain gaps and future innovation capacity.
For an industry that has long sought policy stability and capital support, this budget delivers on both fronts—creating confidence for multi-year investments in manufacturing, R&D, and talent development. As India advances toward its Viksit Bharat 2047 vision, the electronics sector now has the policy clarity and financial backing to transform aspiration into achievement.
This article synthesizes reactions from leading electronics industry executives following the presentation of Union Budget 2026-27 by Hon’ble Finance Minister Nirmala Sitharaman on February 1, 2026.
