Chinese investments complying with FDI norms eligible for electronics PLI: MeitY secretary

Chinese investments that fully comply with India’s foreign direct investment (FDI) rules are eligible to be considered under the Electronics Component Production-Linked Incentive (PLI) scheme, the Ministry of Electronics and Information Technology (MeitY) has said, signalling a calibrated and case-by-case approach rather than a blanket exclusion based on country of origin.

In an exclusive interview with CNBC-TV18, MeitY Secretary S Krishnan said proposals involving Chinese partners are examined against existing FDI norms, regulatory approvals and security-related checks, and are cleared if they meet all prescribed conditions. “There is no automatic disqualification. As long as investments are compliant and due diligence requirements are satisfied, they can be considered under the PLI framework,” he indicated.

The government’s stance was underscored by the recent clearance granted to a subsidiary of Dixon Technologies that has a Chinese partner, making it eligible for PLI benefits. The decision is seen as reflective of a “light-touch” regulatory approach, where investment proposals are assessed on merit rather than being rejected solely on the basis of foreign ownership or origin.

According to officials, this approach is aimed at striking a balance between supply-chain security considerations and the broader objective of scaling up domestic electronics manufacturing. While India continues to subject investments from countries sharing land borders with it to stricter scrutiny, MeitY has maintained that compliance with FDI policy, security vetting and sectoral guidelines remains the key determinant for eligibility.

The Electronics Component PLI scheme is designed to incentivise incremental production and value addition, with incentives linked to percentage-based increases in output and localisation. The programme seeks to attract investments in rupee value, deepen the local component ecosystem and reduce import dependence, particularly in critical electronics segments.

By keeping the door open to compliant foreign investors, including those with Chinese linkages, the government aims to ensure that the electronics manufacturing ecosystem continues to scale up in line with national priorities, while remaining firmly anchored to regulatory safeguards and policy oversight. The move is expected to provide greater clarity to manufacturers and investors navigating India’s evolving PLI and FDI landscape.